Collective switching

Collective Switching is a relatively new activity and allows consumers to group together to increase their buying power and to negotiate a better deal from gas and electricity suppliers. The larger the number of people that are signed up, the more attractive the group of customers is likely to be to the energy suppliers and the better the deal they may offer.

There are a number of different ways a collective switch can be organised but the general principles are as follows:

  1. Consumers register and deal exclusively through a third party scheme organiser.
  2. The organiser will appoint a collective switching service provider who negotiates with energy suppliers on the tariff.
  3. The organiser can choose to offer one single tariff or a range of tariffs to the consumers who have signed up.
  4. Consumers receive their offer and the scheme enters a ‘switching period’ to allow time for consumers to make a decision.
  5. Consumers (under no obligation) can decide to switch and will enter into a new contract with their supplier.

Community groups can look to set up their own collective energy switch or promote an existing switch being run in their area (some of these have been run in partnership with local authorities). Due to the number of people required to sign up and the complexity of arranging an energy auction, it is recommended to check for existing schemes to work with, before establishing your own.

Case studies

Cyd Cymru is a Welsh collective energy switch that has been run for the last three years. It is funded by the Welsh Government and run by local Welsh councils and the Energy Saving Trust. The last switch was organised in March 2015 with 2,000 households switching, saving an average of £250. Some households saved up to £560 where they were on an expensive legacy tariff.

DECC provide guidance for scheme organisers and guidance on what to think about when setting up a collective energy scheme.


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