Utility Week

Utility Week 1st May

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UTILITY WEEK | 1ST - 7TH MAY 2015 | 25 Customers This week British Gas loses 28k business customers Number of business customers falls by 3 per cent, but cold weather boosts residential demand Customer numbers at the business energy supply arm of British Gas slipped by 3 per cent in the first quarter, but colder weather helped boost volume in its residential business. Parent company Centrica said in an interim management state- ment that the number of busi- ness supply accounts dropped by 28,000 to 826,000 in the first quarter while the resolu- tion of its IT billing problems, first reported by Utility Week in January, is "ongoing". Some small companies did not receive a bill for over nine months when 500,000 customers were moved to a new billing system. Also, the number of British Gas Services contract holders fell by 62,000 to just over 7.9 million in the first quarter, the result of a "challenging" sales environment. Despite the decline in contract holders, Centrica said it expects "improved year-on-year profitability" for its downstream operations as colder weather helped its residential supply business bolster sales by 10 per cent for gas and 2 per cent for electricity while account num- bers remain stable at 14.8 million. Centrica said it will set aside an additional £50 mil- lion to invest in the residential supply business area over the next three years. But Citigroup investors noted that without the colder spell "the rest of the businesses appear to still face headwinds". Centrica said its downstream performance would be more than offset by the negative impact of lower com- modity prices on the upstream business. JA ENERGY Ovo Energy cuts its prices by 1.5% Independent energy supplier Ovo Energy is cutting prices for new and renewing customers by 1.5 per cent. The company said the move is in line with "a small downturn in wholesale commodity costs over the past month" and will affect customers on its fixed pay-monthly Better and Greener energy plans. The standard vari- able tariff will not change. Aer the price drop, Ovo's price for an average dual-fuel customer will be £954, a saving of £14 a year. The price cut follows Labour leader Ed Miliband resurrect- ing plans last month for forced energy tariff cuts, saying the party would act immediately to slash energy bills if it comes to power in the May general election. Earlier this month, the Scottish National Party said it would back Labour's plans. ENERGY SSE to cut heat tariff unit rate by 4.6% SSE will cut its heat tariff unit rate by 4.6 per cent for its 4,500 domestic heat network custom- ers from 1 May. The move is in line with a general reduction in domestic gas prices and follows SSE's price freeze last year. The domestic heat network uses insulated pipes to deliver heat, in the form of hot water or steam, to people's homes from a local energy centre. Green groups want more gov- ernment support for decentral- ised energy, which can reduce transmission losses and lower carbon emissions. In July 2014, a report from the Institute for Public Policy Research urged city and local authorities to support and invest in local generation schemes, which could "rival the big six energy companies" through decentralised generation. WATER Water market needs clean customer data Organising and cleaning the data of commercial water customers is a "huge" challenge, according to the managing director of Thames Water Commercial services. Speaking at Utility Week Live, Graham Southall said there remains "an awful lot still to do before we get to 1 April 2017 [and market opening]". He added that water whole- salers "need to ensure the data is fit for purpose to allow the market to operate properly" so retailers are able to offer prices to – and acquire new – business customers. Despite his concerns, South- all was adamant the market will open on schedule. Cold weather bolstered residential energy sales I am the customer Richard Lloyd "Energy efficiency needs a joined-up approach" Whoever ends up in No 10 next month must make tackling energy efficiency part of the agenda. Our new report, A Local Approach to Energy Efficiency, calls for the next government to commit to an aggressive energy-efficiency strategy to help millions enjoy warmer homes, lower bills and better health. Up to 5.4 million homes do not have cavity walls filled, which can cut annual dual fuel bills by £140; and up to 7.4 mil- lion need their los fully lagged. Also, an overhaul of the Green Deal is needed, as well as better overall cost control and value, not least to give consum- ers more certainty about what they pay for green measures. Energy efficiency is a collec- tive failure of successive govern- ments. No more excuses – the next government must grab this issue by the scruff of the neck and tackle the millions of homes still to be insulated. Richard Lloyd, executive director, Which? We need radical improve- ments in the rollout, funding and take-up of energy-efficiency measures including switching to a "long-term local" approach, partly funded by a levy on sup- pliers. This would be paid into a central pot and allocated to local authorities to roll out energy- saving measures. Partnerships between councils and GPs or social landlords could use local knowledge to maximise take-up. We are also calling for a decade-long cross-government plan because energy efficiency needs a joined-up approach across government departments because of the many benefits for health, jobs and the economy.

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