Helping you make sense of the energy and water sectors


Chart of the Week


Switching standards suggest significant supplier spend

Emma Bill Analyst

Having consulted on proposals to introduce new Guaranteed Standards (GS) to improve the switching process, Ofgem has decided to implement four of seven GS from Spring 2019: GS B requires suppliers to agree whether a switch is valid or erroneous within 20 working days of identification of a possible erroneous switch GS D requires whichever supplier is contacted by the customer to send the Erroneous Transfer Customer Charter (ETCC) “20 working day letter” to that customer within 20 working days New GS A1 requires the losing supplier to re-register an erroneously switched customer within 21 working days of an erroneous switch being identified GS F requires the losing supplier to refund credit balances within 10 working days of sending the final bill Three other GS are expected to go-live later in 2019. Failure to adhere to these GS will result in separate payments of £30 by the gaining and/ or losing supplier. A number of respondents to the consultation voiced concerns that new entrants may be deterred by the changes, with one citing a 3% margin on a dual fuel bill of £1,000 – equivalent to one £30 payment, as erroneous switches are often caused by incorrect industry data. Based on the recent switching activity and incidences of erroneous transfers, our chart shows the amount of money that would have been transferred to consumers had the GS been in effect. Estimated breaches are based on an Ofgem 2017 Request for Information (GS B and F) and its own extrapolated switching data (GS D and A/ A1). Ofgem ...

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