Councils use collective switching to get Best Energy Deals

Charity Facilities Management members earlier this year discussed ideas to cut energy costs, from using brokers to buying energy direct.  Local councils are increasingly using the power of collective bargaining to drive down their residents' energy bills.  Is this a model that charities could use?

Peterborough Council has joined up with 11 other local authorities in a scheme designed to get better prices for energy consumers by bulk switching.  The councils are inviting households to sign up for a collective switch-over scheme.   At the end of each round of the scheme, energy providers are invited to participate in a reverse auction, with suppliers competing to offer the lowest price and best deal.

The scheme is being run by specialist firm iChooser, which operates collective switching schemes for communities in the Netherlands and Belgium.

The Council says that in the first round 300 households switched, and made an average annual savings of £122 per household.  Some households saved as much as £400 per annum. The winning energy companies were OVO Energy, Co-operative and Scottish Power. 

The third round of the scheme closes in early June. The 11 local authorities participating are: Blackpool, Cheshire West and Chester, London borough of Havering, Hertfordshire, Hull, Luton, Great Yarmouth, Wiltshire, South Holland, Waverley, and Northumberland.  So far the scheme has received responses from more than 16,000 households.

Councils in Manchester have now started a similar scheme. The scheme attracted interest from more than 7,000 residents within days of the launch.

Peterborough Council says it will launch a dedicated scheme for SMEs.  In the mean time, is this the way forward for charity buyers?