Peterborough City Council has agreed to spearhead the UK's largest collective energy switching scheme.

The initiative uses the idea of bulk-buying to reduce energy costs for residents and small and medium enterprises in the city.

The city council's Cabinet voted unanimously to proceed with the scheme and to appoint IChoosr to operate the scheme at the meeting at Peterborough Town Hall on Monday 5 November.

The Peterborough Collective Energy Scheme will enable people from across the city, and from other communities in the UK, to join together as a single unit to negotiate cheaper energy bills. Now, 11 local authorities will join the city council as part of the scheme, which in total will open up potential savings to over 1.5 million UK households.

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It's expected that residents could see energy savings of between £60 and £200 a year.

The groundbreaking scheme will be the first collective switching initiative in the UK to allow residents who use pre-payment meters to join under the new relaxations announced by the government that came into place from the start of the month.

It will also allow small and medium enterprises (SME's) to join the collective energy switching scheme and could result in savings for 5,000 SME's in Peterborough.

To participate in the scheme, residents will be invited to visit a new website or to contact the council to register their details free of charge, giving their current energy usage figures for gas and electricity.

The scheme will work by means of a reverse auction where energy suppliers will be invited to bid the lowest price to supply the energy to all those signed up for the scheme. Residents will then be sent an offer to switch provider and accept their new energy rates.

Registration for the scheme will commence in November and the results of the reverse auction will be available before Christmas. For SMEs registration and auctions will be held in January 2013.

(CD/GK)