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“Big Six” energy firms to lose quarter of customers


Financial analysts have predicted the “Big Six” energy firms in the UK will lose a quarter of their customers over the next six years.
Citigroup investment bank have released a report detailing the predictions, and they believe some of the firms may be driven out of the market in the next decade. The report stated that consumers will still suffer, with prices forecasted to rise by 20% in the next 6 years, due to the costs of green energy policies and network maintenance, as well as the impact of inflation.

The “Big Six” energy suppliers, consisting of British Gas, SSE, EDF Energy, E.On, ScottishPower and Npower, recently saw their market share fall from 98% to 92% in the last year, due to more consumers choosing independent firms with lower tariffs. Citigroup believes this trend is set to continue at an increasing pace as the market becomes more competitive.

The combined profits of the Big Six could fall 40% from £1.2bn in 2013 to just £700m in 2020 as a result of the erosion of the market share, lower profit margins and customers using less due to energy efficiency.

Citigroup said "We believe there will be a reversal of previous industry consolidation over the coming years as independent suppliers and generators take market share and less competitive players exit"
“Due to increasing competition we see the market share of the ‘Big 6’ in energy supply declining from 98% in 2013 to below 70% by 2020. When combined with declining demand and lower margins the total profit pool available to the large energy suppliers could fall [by about] 40% from [about] £1.2bn in 2013 to just £700m.”

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