Are they giving consumers the best deal?
Consumers are constantly told that there are savings to be made on rising energy prices by shopping around for the best deal. Energy switching sites are promoted as a useful tool for those consumers looking to save.
Research by CFA member Consumer Utilities Advocacy Centre (CUAC) has found that, while savings can be made, switching sites do not always give consumers the accurate information they require. Energy Switching Websites: An analysis of energy price comparison and switching sites available to Victorian consumers was published in May 2010. It showed that the websites reviewed often failed to provide complete information. A number of the privately operated switching websites provided inaccurate information
All the sites were able to identify and recommend a market contract* that reduced the annual bill for a customer currently on a standing contract**. But in some cases the difference in annual savings across sites varied by more than $200. Part of the explanation is that several websites did not include offers from all retailers. Not one website could consistently provide a consumer with the best offer across all five distribution areas in Victoria.
CUAC is calling for appropriate regulation, suggesting as a first step that a voluntary code for price comparison services should be established, based on a similar approach in the United Kingdom.
CUAC has also recommended that consumer protection regulators consider the reports findings to ensure that providers of price comparison websites are compliant with the Australian Consumer Law. CUAC has passed on the details of the research to the Australian Competition and Consumer Commission and Consumer Affairs Victoria.
Download the CUAC report: [ilink url=”http://www.cuac.org.au/database-files/view-file/5410/” style=”download”]CUAC Report: Energy switching sites[/ilink]
*Market contract: an offer negotiated between you and a retailer and may offer you a better price (or some other benefit) than the standing contract. Market contracts may have a fixed term (generally between one and three years), or could be on-going.
**Standing contract: This is a basic contract you will be on if you have not entered into any new type of contract since the introduction of competition, or if you have moved premises and you have not negotiated a market contract.