Call to reward 'loyal' energy customers who don’t switch
Customers who choose not to switch energy supplier could soon be rewarded with loyalty schemes. However, these incentives are unlikely to match what you would save by switching.
Energy customers who do not switch suppliers could soon be given loyalty bonuses under dramatic plans being considered by some energy firms.
At present, around two thirds of households are still on their provider's expensive standard energy tariff.
These people haven’t bothered to even move onto a cheaper energy deal with their existing provider, let alone switch to a rival firm.
In fact, more than half of energy customers have never switched supplier, according to the Competition and Markets Authority, and collectively they are overpaying by £1.4 billion a year.
Don't make your supplier rich - switch to a cheaper energy deal today
Rewarding loyalty?
Now, two of the ‘Big Six’ energy providers, Npower and EDF Energy, have told MPs they could introduce loyalty programmes to “alleviate the extra expense of standard tariffs,” according to the BBC.
The loyalty schemes will target the 10 million customers who are currently paying way over the odds for their energy on standard tariffs, who haven’t switched supplier for at least three years.
The news comes a month after Greg Clark, Business Secretary, said that customers who have been on standard tariffs for a long time could potentially be rewarded, rather than persuaded to move to a different supplier.
What the energy firms say
Simon Stacy, managing director of domestic markets for Npower, explained to the Business and Energy Committee how he thought the reward scheme might work.
“For example, could we provide our standard customers with a free boiler service?
“We’ve done a trial of that to see whether it resonated with customers,” said Stacy.
“We want to try and reward customers in a way they wouldn’t expect.”
EDF Energy has also stated it is looking into introducing a loyalty scheme.
A flawed idea?
If you have never switched energy provider, you could save yourself around £200 a year by moving to a cheaper deal, according to Government's own figures.
By contrast, the average boiler service costs £60, according to figures from Which.
If that’s the reward you get for being loyal, then be disloyal instead. Take a look at the cheapest deals on the market and get switching today!
Switching is just the start. Here's how to slash your energy bills even further:
Cut the cost of heating your home
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Comments
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I don't use much electricity, meaning that now Npower have decided to slap standing charges on all their electricity tariffs, my predicted annual bill has just gone up 50% compared to my fixed-no-standing-charge tariff that has just ended. I'm leaving them now after 5 years, they can keep their loyalty bonus, it'll be a drop in the ocean! I'm also fed up with their IT systems, I had DD problems when they split my duel-fuel gas & electricity account in to 2 without telling me and then threatened to cancel my fixed deal when they didn't get paid because they failed to ask me to agree to a DD mandate for the new account. Their energy usage & prediction graphs are utter garbage and bear no resemblance to my actual usage. At one point the graph figures were telling me my usage had gone up since the previous year whilst the graphic was telling me the opposite!
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Loyalty is a 2 way street. If the customer shows loyalty what do they get? Quite often its to be taken for mugs and charged MORE than new customers are. If that's the business model that companies employ then we only have ourselves to blame because its the inertia of customers that makes the model pay off for the companies. Personally I switch everything unless my existing supplier offers me a good deal on renewal - Daligas and Aviva are two who have kept my business in the past 12 months. I switch regularly between RAC and the AA using quidco to get cashback on the deal. If that's how they want to play I can live with half an hour of searching the market to save £'000s. The best paid work I ever do!
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Just window dressing to make themselves look good to the idiots running the country. Anyone with a brain cell sees through the hype. Get the tariffs bang it into your spreadsheet and then move if the new numbers are better. I am off from OVO to IRESA as the OVO tariff is now far too high. £200 a year too much yet I have been with OVO for six years, no loyalty bonus there then!
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11 February 2017