Utility Week

UTILITY Week 29th April 2016

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

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Customers This week Which? calls for CMA follow-up review Consumer group proposes the CMA commits to review and measure remedies in two years' time Consumer group Which? has called for a follow-up review of the Competition and Markets Authority's (CMA) investigation into the energy market. In its response to the provisional remedies, Which? proposed that the CMA commits to review and measure that the remedies are achieving their aims of increased consumer engagement and effective competition in two years' time, following its concerns that the remedies "still do not go far enough to ensure that the energy market works well for customers". The response adds: "The CMA should set out how this testing will continue beyond the final remedies to make sure that the measures put in place will deliver sustained engagement by consumers with the market." Meanwhile, independent supplier Green Energy has slammed the probe for becoming "over politicised", and has called for more "radical" thinking. The firm's response also accused the inquiry of ignor- ing the public's freedom of choice and "tinkering around the edges". It said: "We are concerned that the whole process has become over politicised; Hinkley Point makes clear that energy policy decisions need to be made over 20- to 30-year cycles, short-termism doesn't suit useful energy policy and we have had a series of tinkering around the edges culminating in the biggest tinker of them all – sharing customer information." The final remedies from the investigation are due to be published in June. SJ Analysis, p27 ENERGY Signs 'not good' for Eco replacement Shadow energy minister Alan Whitehead has warned that early signs suggest the replacement scheme for the Energy Company Obligation (Eco) and Green Deal "won't be good enough". Whitehead, who was formerly a member of the Energy and Climate Change Committee, told Utility Week: "The good news, I suppose, is that there is a programme at all, because for a while it looked like there wasn't going to be a replacement Eco." However, he added the bad news is "it doesn't look like it's going to be anything like even the level of Eco". He said: "All we've got at the moment is the Autumn Statement announce- ment on what Eco might look like post-2017 – [a value of] £640 million per year and a general target of 200,000 homes treated per year up until 2021. "That represents roughly a 40 per cent fall on what was Eco expenditure previously, and a much larger fall on what will be the number of houses treated." ENERGY No investigation for Eon's Age UK tariffs Ofgem will not launch a full investigation into Eon's market- ing of its tariffs with Age UK, aer allegations that the charity encouraged pensioners to take out expensive tariffs with the energy supplier. Age UK and Eon both denied allegations, made by The Sun newspaper in February, that pensioners paid up to £245 a year more on the charity's rec- ommended deals, than on Eon's cheapest tariff in 2015. Ofgem said it had looked into Eon's marketing of its tariffs with Age UK and concluded there is "no case" for an investigation. ELECTRICITY MPs accuse Scottish Power of fraud MPs have released a damning report accusing Scottish Power of defrauding 625,000 customers out of £75 million, by mis-selling a warranty scheme for electrical goods. Andrew Percy, chair of the all-party parliament group set up to look into the matter, said MPs had seen evidence of a "callous and dishonest culture then and now at Scottish Power, which put their profits high above the needs and rights of their customers". Scottish Power has denied any wrongdoing, saying the allegations are "factually and legally flawed" and the report's findings "ignore evidence put to the group in writing". The report related to PowerPlan warranties sold at the supplier's now defunct high street shops. Call for energy market to work well for customers I am the customer Maf Smith "Onshore wind is one of the cheapest power sources" First the good news – figures released by the Department of Energy and Climate Change show that a record 25 per cent of the UK's electricity was gener- ated from renewable energy sources last year. Wind power played the leading role, generat- ing almost half of this, and there were big increases in bioenergy and solar output too. At the same time, the govern- ment published figures showing that the average annual house- hold electricity bill decreased We can predict and con- trol the cost of home-grown renewables, whereas no one can foresee global fluctuations in the price of imported fossil fuels. So next time someone suggests that going green costs an arm and a leg, it's worth remembering that the evidence shows otherwise. The renewable energy sector is as committed to offering value for money as it is to cleaning up the way we generate electricity. Maf Smith, deputy chief executive, RenewableUK by £8 (or 1.4 per cent) in 2015, because of falling energy costs and lower demand. Relying increasingly on renewables makes economic as well as environmental sense. Onshore wind is now one of the cheapest of all power sources. Meanwhile, a tenacious focus on technological innovation and economies of scale have driven down the cost of offshore wind earlier than expected, with increasing confidence about our ability to sustain these cost reductions. The government's advisory body, the Committee on Climate Change, says offshore wind will be cheaper than new nuclear and gas plants by 2025. UTILITY WEEK | 29TH APRIL - 5TH MAY 2016 | 25

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