The move means that at least Co-op and First Utility look set to bid their lowest price for potentially hundreds of thousands of new customers.
Co-operative energy currently has about 20,000 customers. First Utility has about 90,000 customers. Some 250,000 have registered an interest with the collective switching exercise organised by Which? and campaign group 38 Degrees. In theory, if Co-op won the auction, it could increase its customer base twelve-fold if all those that signed up actually take its offer. That would push it over the threshold at which it is liable to for supplier obligations, which could add millions of pounds of cost to its business. Realistically though the conversion rate will probably equate to tens of thousands of people potentially switching supplier.
See the Co-op’s letter on its website here.
EDF, Eon, Npower and Scottish Power have not yet ruled themselves out of th auction, but neither have they committed to bidding on the 26 April either. British Gas and SSE have ruled out taking part in the Big Switch citing concerns about predatory pricing. However Co-op has sidestepped this by promising to offer any new customers nothing cheaper than it offers its existing customers.
For further reading, and industry views on how collective switching could work, see this feature.