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THE BIG FIVE Compare the Market Money Supermarket Go Compare Confused.com Uswitch The Topic: TPIs THIRD PARTY INTERMEDIARIES THE TOPIC SMART METERS WILL ENABLE THE EVOLUTION OF INTELLIGENT SWITCHING SITES £22-£30 commission earned on switches by switching sites per single fuel customer 40% of the domestic market uses a price comparison site to switch 3.5m people used MoneySupermarket to compare energy deals last year 320,000 people switched supplier using MoneySupermarket SWITCHING SITE FIGURES 8 | 3RD - 9TH JULY 2015 | UTILITY WEEK P rice comparison sites are key to a dynamic domestic energy mar- ket. They have become integral players in the constant push to increase switch- ing and important facilitators for customers seeking cheaper tariffs – and therefore of the wider pol- icy ambition to drive down bills. However, in recent months switching sites have come under fire for failures in transparency and, thereby, misrepresenting their helpfulness to customers. Despite the largest switch- ing sites telling the Energy and Climate Change Select Com- mittee in February that hiding the cheapest tariff available to customers was wrong, evidence found that this was in fact com- mon practice for many price hand tactics of other switching sites, has made calls for commis- sions to be made public, saying: "Commissions are a cost that end up on our bills. If compari- son sites have been colluding to fix these commissions at a high level, that is a scandal. Com- parison sites should now publish their commissions as a matter of urgency, but many consumers will never trust them again." Unsurprisingly, not all switch- ing site chief executives have backed this call and, in a writ- ten submission to the committee hearing, Ofgem also outlined its reasons for not making commis- sions public. The regulator said that doing so would risk "con- fusing customers", "lead them to make poor decisions to lower the amount of commission earned", and "lead to tacit coor- dination among suppliers and/ or sites." That said, in February, before the code was published, Ofgem launched an investigation into energy price comparison sites over whether "two or more" have been sharing information on the commission rate they are charg- ing to energy suppliers, which somewhat blows a hole in their last argument against the publi- cation of commissions. The committee mused over whether the time is right to intro- duce a not-for-profit switching site to take commissions com- pletely out of the equation, like the Australian government has chosen to do. Whether it chooses to recommend this action or not it seems there is a growing feeling that services designed to make the notoriously confusing energy market clearer, are themselves get- ting into increasingly murky waters. Calls for greater transparency, scrutiny and regulation are not unlikely. Everything comes at a price Lucinda Dann explores price comparison websites, the essential intermediaries in the domestic energy market. comparison players. Instead of showing the full gamut of deals available, these sites only showed tariffs on which they would receive commission. Cus- tomers had to manually opt-in to a whole market view to see the full range of tariffs. In March Ofgem showed it can flex some muscle in the domestic market, if not on the business side, by publishing a revised code of conduct for energy price comparison web- sites. Enforced from the 1 April, accredited sites must now show all tariffs available as stand- ard and explain more clearly that commission is earned on switches made through the site. Consumer collective the Big Deal, which published the origi- nal research revealing the under- The wealth of data that the imminent smart meter rollout will provide should lead to the evolution of intelligent switching sites. Such sites will theoretically be able to learn what matters to individual customers when picking an energy deal and automati- cally prompt them to switch to deals that offer the best balance of their preferences. They may even offer a service for continu- ous switching, taking all of the hassle and irritation out of the customer's hands once their preferences are approved. Smart energy consultant Susan Furnell says: "People have always said that this is a thing that could happen in the UK and that switching times were a barrier, but now they have come down to 17 days. When you have smart meter data and the ability to get the user to authorise that data, it will be easier to provide this kind of service." Furnell says this kind of service could evolve before the meter rollout by adding sensors to dumb meters. "There will be disintermediation by all kinds of players once the data is there. Other people will be able to grab that relationship, and what's in it for them is some kind of fee to keep moving the customer." LD An update to the code is expected over the summer. This will include expanding its scope to white label sites