Utility Week

8 | OCTOBER 2021 | UTILITY WEEK Campaign Introducing Energy Reset In the wake of turbulence in the energy retail market, sparked by sharp hikes in wholesale gas prices, Utility Week has launched Energy Reset. James Wallin explains the aims of the campaign. T he state of the energy retail market was thrust into the spotlight during Sep- tember as surging wholesale power prices ramped up the pressure on an already beleaguered market. However, Utility Week readers already knew only too well that this was a broken market long in need of reform. The pandemic exposed once again how precarious some business models were, sparking fears that a wave of Covid-related debt would result in multiple supplier failures. In fact, 2020 turned out to be a pretty benign year in terms of market exits and the expected surge in consumer debt mercifully failed to appear. However, the problems did not go away and the calls from industry for reform did not die down. Our recent Remaking Energy Retail report pointed to both the huge oppor- tunities available for innovative retailers in the energy transition but also the frustrat- ing lack of reform in policy and regulation to support this. It would be wrong to put all the blame at the door of policymakers and regulators. There is no doubt there are businesses that capitalised on low prices last year to offer unsustainable tariffs. Now the music has stopped, these short-sighted strategies have been exposed. But there is a justifiable sense of frustra- tion that lessons have not been learnt and there has been little meaningful action on developing a retail market that is fit to lead the energy transition. This was evident in the pamphlet-sized Energy Retail Strategy published in July, with its much-maligned focus on autoswitching but little else of substance. So let us hope that one positive to come out of the pain the sector is going through at the moment is that it prompts real engage- ment with government and there is genuine action on reforming the market. That's why Utility Week is this month launching the Energy Reset campaign, aimed at looking beyond the crisis towards a new dawn for energy retail – one that sup- ports sustainable operators to spearhead the net zero push. We want to work with the industry, gov- ernment and regulators to support this vision and to seek consensus on a way for- ward. However, there are some clear actions we would call for at the outset: 1) Everyone can agree that customers, and particularly those in vulnerable situa- tions, must be protected. Government has to ensure that in the event of multiple market exits or the failure of a significant supplier there is a safety net, whether that is support for retailers picking up the pieces or the creation of a state-backed entity in the short-term. 2) Government must fulfil its promises on energy efficiency and bring forward a detailed, costed plan to ensure energy bills are driven down by keeping homes warm. 3) There must be an immediate, and mean- ingful, review of the green levies heaped onto energy bills, ending a regressive sys- tem and easing the pressure on bills 4) The government should end its damaging obsession with autoswitching and refocus its energy retail strategy on fostering engagement and long-term relationships between retailers and customers.

• Cover