Utility Week

UTILITY WEEK | 4TH - 10TH OCTOBER 2019 | 21 Policy & Regulation This week Price cap 'could lead to 10,000 job losses' Energy UK director says the cap is at a level where most firms will make a loss or no profit Up to 10,000 jobs are expected to be lost in energy retail this year as the industry struggles to adapt to the price cap, an Energy UK director has said. Audrey Gallacher made the prediction last week during a debate about consumer trust hosted by the Ombudsman Ser- vices. The trade body's director of policy said the cap, which was introduced in January, had le‚ companies with little scope to invest in the new technologies that would ultimately make them more efficient. She said the next stage of the debate needed to centre on ways to achieve these efficiency savings. Labour energy spokesman Alan Whitehead, who pushed for the introduction of the cap, said his concern was about how the decision would be made as to when to remove the cap. Octopus Energy's director of external affairs, Clementine Cowton, said this should be when "it no longer matters if it's there or not because suppliers are competing so aggressively". Gallacher said: "Ofgem have set the cap at a level where most companies will make a loss or no profit. We estimate that over this year about 10,000 retail jobs will go in order to meet that cap. The price cap means nobody will make any money and at the same time companies need to invest to become more efficient." Cowton said in her view the price cap was "abso- lutely working". She added: "Having the price cap in place makes people think – 'what's the worst that could happen, I'll try another energy provider and if I end up on the price cap, I'm no worse off '." JW WATER Usage 'should be cut to 100 litres a day' Labour's shadow water minister has signalled that he would like to see water usage slashed to 100 litres per day. Luke Pollard's comments come as Water UK prepares to release research pointing to how water companies can work towards this target. Speaking at a Labour party conference fringe session last week, Pollard praised Southern Water's Target 100 initiative. This seeks to reduce its custom- ers' per capita water consump- tion to 100 litres per day, a big reduction on the current average of 140 across England, by 2040. "It's a really good initiative and shows that water compa- nies can adapt their vision," he said, adding that while Labour's water policy has yet to be signed off, he "likes it". "Politicians talk a lot about leakage but we would like to see the same political priority and attention to per capita consump- tion, which has a direct knock- on effect on affordability, as we do to leakage." Water UK chief executive Michael Roberts told the event that the industry body will soon release research that examines how consumption levels can be cut to 100 litres per day. He said it showed that this could be achieved by a combi- nation of measures, including stipulating minimum standards for water efficiency for house- hold products such as washing machines and dishwashers. ENERGY ASA raps Outfox the Market over advert Challenger energy supplier Out- fox the Market has been rapped by the Advertising Standards Authority (ASA) over a mislead- ing Facebook advert. On 5 April the supplier's Facebook page featured a cover video featuring a graphic which stated it offered the "cheapest green deals in the UK". A further post on its page, uploaded the same day, claimed there was a "14-hour window" in which the supplier was the sec- ond cheapest supplier, but it had since reclaimed the top spot. A graphic stated "the cheapest energy supplier in the UK". The complainant however found that the supplier did not offer the cheapest tariff when carrying out different searches on comparison sites. The ASA concluded that because it had not seen suf- ficient evidence showing that Outfox "consistently and regularly" offered the cheapest energy and green energy tariff to all consumers in the UK, the ads were misleading. It ruled that the ads must not appear again in their current form. Gallacher: 'nobody will make any money' Political Agenda David Blackman "Energy efficiency is unsexy but less likely to lead nowhere" It was pretty quiet earlier this week at the Conservative party conference in Manchester. It was possible to find a table in the Midland Hotel right next to the main conference venue, which is normally heaving throughout the annual Tory jamboree. Turnout was better by the following day, by which point most MPs probably realised that they could afford to make the trip to Manchester even if the House of Commons was sitting. A rash of pre-election at the conference contained no new details on how the government will implement its landmark pledge earlier this year to cut emissions to net zero by 2050. More significant was prob- ably her housing counterpart's move to press ahead with the Future Homes Standard, which will boost the energy efficiency of new dwellings. Energy efficiency may be unsexy, but it is less likely to be a road to nowhere than fusion. announcements during the con- ference don't seem to have really caught the imagination of an electorate that remains focused on the unresolved problems surrounding Brexit. Those announcements included a package of measures, leaked over the weekend, to deliver the 2050 net zero emissions pledge. The most eye-catching of these was extra funding for nuclear fusion. However, as the wags invariably point out, fusion technology always seems 30 years away from taking off. Business and energy secre- tary Andrea Leadsom's speech

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