Now that’s a power cut

Big Six ‘to lose 2.75m accounts’ as families switch to smaller and cheaper energy suppliers

‘To survive they need to modernise’

BRITAIN’S ‘Big Six’ energy companies are set to lose 2.75million customer accounts this year as families switch to smaller and cheaper suppliers, analysis shows.

The major firms – British Gas, SSE, EDF, Eon, Scottish Power and Npower – shed 1.38million accounts between January and June.

If they have continued to haemorrhage customers at the same rate in the second half of the year, this could add up to more than 2.75million net account losses, according to a review of Ofgem data by comparison site Energyhelpline.

This would be a 38 per cent increase on 2018 – when two million accounts were switched from the Big Six to small or medium-sized suppliers.

Households have been ditching the major providers in a bid to get cheaper and more flexible deals for several years.

In 2012, the Big Six were estimated to supply 99 per cent of households – but this has fallen to less than 75 per cent.

The accounts the Big Six are expected to lose equates to around 1.5million households. This is because most packages are dual-fuel electricity and gas deals, so they are usually counted twice.

The latest calculations come just days after German group Eon said it would cut 4,500 jobs at Npower, as the group struggled to stay profitable.

Eon took over Npower in September and has been looking for ways to sell it ever since.

The Npower brand will be ditched and customers transferred over to Eon – meaning that the Big Six is due to become the Big Five.

The Ofgem data does not break down how many accounts each individual provider lost in the first six months of the year, but Npower said it lost 447,000 between January and September.

British Gas, which trades as Scottish Gas north of the Border, recently revealed it lost 107,000 accounts in the four months to October – which was seen by the stock market as an improvement from 2018, when 742,000 accounts were abandoned.

The spike has coincided with a boom in the number of small and medium-sized competitors entering the market. There are around 60 energy suppliers now, up from 33 in December 2015.

But this explosion has not necessarily helped consumers.

Many smaller providers have gone bust – with 16 firms including Iresa, Solarplicity and Spark Energy collapsing since January 2018, which has affected some 1.2million customers.

Mark Todd, co-founder of price comparison site Energyhelpline, said: ‘The energy market is in a period of rapid transition.

‘The big suppliers, which were once so dominant, are now under constant attack from around 60 smaller suppliers.

‘To survive they need to modernise, slim down and diversify.

Expect to see more job losses and restructurings in the years to come – but also more cheap prices and new offers to customers.’

If the rate of switches continues until the end of the year, there will have been 11.4million moves in total in 2019.

This would be a huge rise from 9.9million in 2018.

The Big Six have struggled to stay competitive after the Government introduced a price cap on default tariffs in January.

It currently stands at £1,179 for a standard dual-fuel gas and electricity account.

All energy firms face the spectre of nationalisation if Labour wins this month’s General Election.

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