Who are the Big Six Energy Suppliers?
“Big six” may be a term that you’ve heard on the radio or seen on the news before. This has historically meant the six companies that take up the majority of the task of energy provision in the UK. Despite their economic importance, not everyone knows who the big six are, let alone whether the term still holds the same weight as when it first came into public use.
So, Who are the Big Six Energy Suppliers?
The first thing you’ll probably be thinking is, ‘who are the big six?’. It comprises the UK’s six largest enemy companies that are still operating to this day. The original six companies are British Gas, E. On UK, Npower, SSE, Scottish Power, and EDF Energy.
At the moment, around 70% of all British homes have their gas and electricity provided by these six companies. This does, of course, leave someone else to provide the other 30%, and that someone else is a vast number of smaller companies that have slowly been getting their share of the UK market. These smaller companies aren’t only important because they are increasingly vying for the big six’s market share. They’re also starting to challenge what the big six fundamentally means.
OVO were one of the first outside companies to come in and shake up the big six. This happened after OVO and SSE announced an agreement to procure the latter’s customer portfolio. It may be that as time goes on that the SSE slowly slides out of the standard definition of the big six to be replaced by OVO. It’s also possible that we start to hear the term big five plus OVO come into regular use instead.
Another heavyweight that may be coming in from the outside to shake things up is Shell. This global behemoth bought one of the more notable challenger companies, First Utility, Shell Energy. It’s hard to imagine that a company with as much power and as many resources as Shell would’ve made such a move to play a bit-part role. It seems inevitable that Shell energy starts to make a significant move on the big six at some point in the future.
Companies are also starting to gain a foothold without any form of acquisition or takeover. Many are using modern business and marketing tactics such as introductory offers to tempt new customers. Smaller competitors such as Octopus and Bulb have seen a rise in popularity as they manoeuvre their price ranges to make themselves the most appealing option to new customers.
Until 2010 the big six had over 99% of the electricity supplies market share, and it took until 2015 for that share to drop below 90%. As of 2020, OVO has the second largest market share at 15%, only behind British gas at 24%.
For many people, this disruption of the classic big six is a very welcome change. As it traditionally stood, many analysts would’ve described the energy market in the UK as uncompetitive. The dominance of the market by just a handful of firms was what many economists would describe as an oligopoly.
Although it is illegal in most cases, strong suspicions of price-fixing have consistently arisen as almost simultaneous price rises manage to squeeze extra money even out of the most impoverished households and prevent fiscal alternatives from arising. The energy price cap brought in in 2019 has helped to prevent price-fixing. However, it is still widely believed that those who profit from the industry have far more to gain through unseen collaboration than any free-market competition ideal.
As in almost any industry, when business owners manage to get their way, they can raise prices collaboratively and brazenly swipe aside the idea of genuine choice for customers. The size of the big six means they have the resources to produce marketing and lobbying to make these outcomes far more likely than most customers would like. It’s also possible for the companies to buy and trade the energy due to their structure, which allows for further manipulation.
Luckily, the rise of smaller suppliers and energy businesses coupled with the price caps is predicted to make the market more competitive and better for buying customers, including households and businesses.
Yet, not everyone is yet aware of just how easy it can be to change energy suppliers. Many people think that although they’d like to change energy companies to a provider that provides better price options, there will be some sunk cost such as having piping or cables replaced. In most cases, this isn’t even close to reality, however. Providing a household isn’t locked into a long-term contract of some sort. In most cases, changing suppliers is financially and practically feasible.
Starting the process can be done online, where sites provide price comparisons for different energy businesses and the options depending on your postcode. Getting some paperwork together, such as a recent energy bill, is likely to come in handy and getting a few quotes will be quick and painless. It could be a new time for the energy market to be good for customers in the UK. You can read more about the big six energy suppliers here.
Other useful links about Business Energy
EDF Business Energy
Deemed Rate Energy Contracts
What is an Energy Performance Certificate
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