Utility Week

UTILITY Week 15th January 2015

Utility Week - authoritative, impartial and essential reading for senior people within utilities, regulators and government

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UTILITY WEEK | 15Th - 21sT JanUarY 2016 | 23 Customers This week 'Tough message' expected from CMA safeguard tariff for vulnerable customers tipped as one likely outcome by analysts at Citigroup Anticipation of the Competition and Markets Authority's (CMA's) provisional recommendations for the energy market mounted this week, with a safeguard tariff for vulnerable customers tipped as one likely outcome by analysts at Citigroup. Citigroup said in an investor note that the provisional recom- mendations, to be published later this month, were expected to contain "tough message[s]" for energy retail- ers. It predicted "a number of measures to promote retail competition, as well as the introduction of regulated tar- iffs for vulnerable customers". Such a measure would be an apparent retreat from the CMA's first set of remedies, published last autumn, in which it outlined plans for a "safeguard tariff " that would effectively cap the price charged to any customers on a standard variable tariff. Citigroup added: "We do not expect further action to remove retailers' own ability to set their own tariffs." SSE chief executive Alistair Phillips-Davies told the Financial Times last week that the group would "have to think about" legal action if the CMA pressed ahead with its original proposal. He also took issue with the CMA's claims that energy suppliers had overcharged customers by £1.7 billion a year. Phillips-Davies said: "[The CMA] have completely failed to substantiate the evidence they have got and I think they have overestimated what they have done." Meanwhile, The Daily Telegraph reported that the CMA is considering a move to end indefinite standard tariffs and "force" customers to choose a new deal each year. EB EnErgY Rudd: smart meters will be 'affordable and effective' Energy secretary Amber Rudd has insisted that the smart meter rollout will be "both affordable and effective". In a letter to The Times, Rudd highlighted the Competition and Markets Authority's acknowl- edgement that smart meters will increase energy efficiency and provide customers with more accurate bills. She added: "Smart meters form part of our digital future, will underpin the smart grid and provide energy networks with crucial data to help them become more efficient. Smart meters are a key investment, helping us to move to an infra- structure fit for the 21st century." The mass rollout of smart meters is due to begin this summer; the UK has signed up to a European target to have a smart meter in every home and business by 2020. Pan-UTILITY Utilities not trusted to keep data safe A global poll has revealed that 97 per cent of consumers don't trust utility companies to keep their data safe. According to the survey by Verint, conducted across nine countries and more than 18,000 people, one in five UK consum- ers are suspicious about data protection in any business. Director of customer analytics EMEA at Verint, Rachel Lane, said: "As utility companies are facing increased compliance, regulatory risks and volatility in commodity pricing, one of their biggest challenges is to retain and attract customers. "There are, however, two key elements that will help drive that customer loyalty, and attract new prospects: customer experience and customer trust. The two are intrinsically linked. To build trust and confidence, utilities companies will have to be more transparent with their customers." WaTEr Severn Trent selects chair for customer challenge group Severn Trent has appointed Gill Barr as the new independent chair of its customer challenge group, known as the Severn Trent Water Forum. Barr succeeds the current chair, Bernard Crump, and her appointment will run until March 2020. Barr has an extensive back- ground in retail and marketing, having previously held senior marketing roles at John Lewis, MasterCard and the Co-operative Group, and is an experienced non-executive director. Phillips-Davies: 'CMA has overestimated' I am the customer Claire Jakobsson "Energy is by far the bigger concern for manufacturers" Businesses appreciate any steps taken to reduce uncertainty, whether relating to government policy or price fluctuations. This can help them better understand their future cost exposure and secure investment in efficiency measures to reduce consumption. Given the costs and level of regulation now involved, energy is by far the bigger utility concern for manufacturers. But suppliers can help. Energy suppliers have a clear role in helping their customers supplier for information about such decisions and their likely impact, but will also expect their supplier to represent their views in ongoing policy discussions. It's a responsibility, but being a source of expert guidance, information and support to customers presents an oppor- tunity for suppliers to deepen relationships and add real value. Claire Jakobsson, head of climate, energy and environment policy at EEF, the manufacturers' organisation understand future price fluctua- tions; providing the best avail- able information on likely future wholesale prices, increases in government policy costs and any changes to transportation charges. A proactive approach to providing this information in a user-friendly way would be top of our utility wishlist for 2016. Suppliers are also oen the sole point of contact companies have with regards to energy policy. 2016 will see the continu- ation of the Business Energy Effi- ciency Taxation Review, the pos- sible demise of the CRC scheme and alternative energy reporting arrangements. Manufacturers will not only look to their energy

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