December 2023
All Performance Assurance Insights Articles
December 2023 Newsletter
by Lewis Williams, Performance Assurance Analytics Manager for the Code Manager
At the Performance Assurance Board (PAB) meeting in November 2023, the Code Manager presented our analysis of switching trends in the market to date in 2023. The PAB Members were particularly keen to understand any changes following the end of the Energy Price Guarantee (EPG) in July 2023. In this newsletter I will be providing an overview of that analysis and the subsequent PAB discussion.
Key Reflections - Switching Volumes
Throughout 2023 to date, we have seen an overall steady upward trend in switch activity, from around 200,000 switches in January to around 450,000 in October. A sharper increase was observed between July and August following the end of the EPG. However, it may be the case that this is an artificially large spike, driven by the P1 Switching incident (INC0216074) that occurred in July 2023, pushing some switching activity that was due to complete in July into August.
It is clear that the majority of switching activity in the market YTD has been driven by internal migration activity. We estimate that 9 million of the 11.2 million switches completed this year are related to internal migrations.
The Non-Domestic market contracting cycle also drives two peaks throughout the year, in April and October. In each of these months, we can see around 70,000 extra Non-Domestic switches compared to the average across the other months of the year.
Switch Exception Handling
We monitor non-completed switch routes, such as objections, withdrawals and annulments primarily because the REC requires these queries between Parties to be resolved quickly to enable the consumer to reach the appropriate outcome without undue delay. However we also monitor them because high rates can indicate issues with an individual Party’s process, or with the performance of a REC Service. the good news is that from the data, this does not appear to be the case.
The above graphs show a reduction of the rates of the most unsuccessful switch outcomes over the year, with each approximately halving over the course of the year:
- Objections: 8.9% to 4.6%
- Annulments: 0.2% to 0.1%
- Erroneous Switches: 0.5% to 0.2%
- Withdrawals: 0.9% to 0.5%
The rate of objections in the Non-Domestic market is the one exception. This is perhaps unsurprising given the differences between switching activity in the Non-Domestic and Domestic markets, and there being more available reasons to object to a Non-Domestic switch than a Domestic.
Because of the way the Performance Assurance Framework is designed, these reductions in rates mean our team can spend more time identifying and driving improvements in the REC, with ongoing monitoring in place to tell us if performance changes and increased focus is required on switching.
We will also report to industry through a combination of future newsletters and Performance Assurance Webinars.
Summary
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Switching volumes have shown a steady increase over 2023 to date.
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The majority of switching activity is driven by internal migrations.
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The rates of unsuccessful switch outcomes as a proportion of successful switches have declined despite the increase in switch volumes, which provides an indication that the switching process is working as intended.
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We will continue to monitor and report on switching activity going forward.