What then is collective switching?
A collective energy purchasing scheme first needs to gather together a pre-determined number of people to make any attempted negotiation worthwhile.
Assuming enough people have signed up to the scheme, it then closes and what is known as a reverse auction for the energy supplier and a plan is carried out.
This means energy suppliers who want to supply the group bid against each other. Whichever supplier offers the best deal is then selected by the organisation that’s in charge of the scheme.
The reason the plan is first closed is to allow time to assess the group’s energy needs, as well as making sure a plan can be chosen that suits the energy needs of the majority of the group.
People who sign up to the scheme generally aren’t under any obligation to take up the deal once the terms have been decided, however it’s a good idea to make sure you check before you register. Once the plan has been announced you can decide whether it’s right for you and if so switch.
These types of deals could also be more attractive to groups living in more rural areas, where energy costs may be higher. As an individual, a cheap deal may be hard to find, but by joining together in the community, a cheaper price could be negotiated. The more of you there are the better the outcome is likely to be.