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26 | 6th - 12th June 2014 | utILItY WeeK Customers This week Excessive regulation hits customer service high turnover of regulation hampers suppliers' customer service as their staff focus on compliance The introduction of a significant amount of new and complex regulation has had a "detrimen- tal impact" on customer service, according to the big energy firms. The "high turnover" of regulation, largely coming from Parliament, has hampered the suppliers' customer service as their staff focus on complying with the regulations. A supplier industry spokesperson said the regulator and politicians "had to be seen to be doing something" and this has resulted in "an avalanche of stuff" being introduced. The changes, including £50 that was knocked off energy bills, were said to be "short-term policies" that had to be rushed in, despite not being fully thought through. In their responses to Ofgem's consultation on the CMA market investigation reference, two energy suppli- ers have criticised the continual creep of regulation. Npower stated the significant increase in volume and impact of new regulation "may have been to the detri- ment of other changes to improve customer service". Eon said: "The approach taken has consumed a significant portion of our business' capability to cope with change." First Utility, Centrica, SSE and EDF Energy were also critical of the introduction of regulation, and pressed for the CMA to investigate its impact on customer service and competition. An Ofgem spokesperson said: "If we were to make a reference, it would be for the CMA to decide which features to focus on within the scope of the terms of reference, but we would fully expect and want this to include the action Ofgem has taken to intensify competition and protect consumers." MB energY Consumers are '£1.2bn in credit' More than half of energy customers are between them £1.2 billion in credit to their sup- pliers, according to research by Uswitch.com. The switching site says the number of households in credit to their energy supplier has increased from 47 per cent in 2013 to 52 per cent this year. The average household in credit is owed £86, although 21 per cent are in credit by more than £100, and 250,000 house- holds could potentially reclaim more than £500. The rise in the number of households in credit was attrib- uted to lower energy usage as a result of the mild winter and concerns over costs. The switching site also stated that despite the increase in the number of those in credit, almost four million households (14 per cent) were in debt to their supplier. The average amount owed was £128, with the collective debt being £464 million. eLectrIcItY EU approves green levy compensation The European Commission has cleared UK plans to compensate energy-intensive industries for the cost of the carbon floor price. The proposals to shield heavy industry from the green levy is in line with state aid guidelines, the Commission has ruled. HM Treasury introduced an extra tax on UK electricity generators in April to top up the low European carbon price. The government promised to partially offset the higher cost of electricity for certain major elec- tricity users, subject to the state aid clearance now granted. Water Ofwat okays NWL and Welsh Water Ofwat has accepted Northum- brian Water's and Welsh Water's proposals in dra determina- tions for PR14. Welsh Water will reduce bills by 5 per cent in real terms over the next price control period, 2015-20, and will invest more than £2.5 billion. Northumbrian Water will cut bills by 2 per cent and invest £2.7 billion. In its original plan published in December, Welsh Water proposed an average reduction in bills of 4.8 per cent before inflation, while Northumbrian proposed no overall change. The companies said they were able to cut bills further by accepting a lower cost of capital following Ofwat's announcement that its target weighted average cost of capital (Wacc) is 3.85 per cent for 2015-2020, down from 5.1 per cent in the current cycle. Parliament: 'high turnover' of regulation I am the customer Andrew Bainbridge "The looming power crunch could have been averted" Two things have remained consistent in the nearly three decades since I established the MEUC. The chaos caused by the politicians means that customers pay higher and higher bills but government will always find somebody to blame for the problems they create. Now energy companies are going to face significantly higher charges if they fail to buy enough power to satisfy customer needs and we have to endure blackouts. But the shale, but I suggest we don't hold our breath waiting for fracking to reduce our bills. Our Demand Side Management Group and our Behavioural Change Group are helping large customers to look at all possible ways of reducing consumption and so minimise carbon emissions and costs. While Brussels makes life tough for the customer, we need practical action to use less. Andrew Bainbridge, chairman, Major Energy Users' Council looming power crunch could have been averted as old plants close if the legislation had encouraged new-build. The billionaire Jim Ratcliffe isn't waiting for government to approve shale gas drilling. He is going to import 1.6 billion tons a year from America and Mexico to his facility in Norway, owned by his chemical giant Ineos, and from there to Grangemouth. The government wants to drill for shale in National Parks but Cuadrilla's partner, Centrica, says that is not a good idea. And so the controversy rages. The House of Lords Economic Affairs Committee has urged the government to go all out for