Utility Week

Utility Week 8 July issue

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Page 26 of 31

Customers This week Customers 'should help set water prices' Wics chief says empowering customers would help to reduce the complexity of regulation Customers must be more heavily involved in the process of setting prices, the chief executive of the Water Industry Commission for Scotland has urged. Speaking at a London confer- ence on water market reform, Alan Sutherland said: "Looking forward to water industry regula- tion in Scotland, I doubt that we will be following the route mapped out in Water 2020. "But what we are interested in doing is work on legitimacy from a customer standpoint – we're terribly worried about making sure that services are increasingly resilient. "So our focus is going to be on one thing, and one thing only, which is deepening and extending the involvement of customers in the price control. To do that, what we think the big number one challenge is, is to reduce the complexity of regulation. This has all got far too difficult. "When you need ten or more people on each side of a table discussing issues, or you need to spend days with illustrious economic consultants trying to work out how things work, then you know you've got problems." He said "empowering customers" was the "number one way" to get trade-offs made successfully. Also speaking at the conference, associate at envi- ronment think tank Sustainability First, Sharon Darcy, agreed, saying complexity is something that "must be avoided". "As long as there is complexity in the rules around balancing and settlement, it's very difficult to get customer trust in the process," she said. LV WATER Four more firms apply for licences Four more water companies have applied for water supply and sewerage licences, which would allow them to operate in the retail market when it opens to competition in April next year. Anglian Water Business, Sutton and East Surrey Water (SESW) Services, Water 2 Busi- ness (a joint venture between Wessex Water and Bristol Water) and Kelda Retail (the business retail arm of Yorkshire Water) have all applied to Ofwat for licences in the past week. This brings the total number of applications to 12 since the licence application process opened in April this year. ENERGY CMA slammed over price site remedy The Competition and Markets Authority (CMA) has been slammed by the chair of the Energy and Climate Change Committee (ECCC) for its plan to remove the requirement for price comparison websites (PCWs) to show all available tariffs. ECCC chair Angus MacNeil told CMA chair of the energy market investigation panel Roger Witcomb that PCWs should be renamed as "price advertising agencies" and that the move risks "eroding consumer trust" further. Witcomb retorted the move is necessary because the whole of market requirement means the commercial PCW model is "not sustainable" and would see them leave the market, harm- ing customer engagement and switching levels. ENERGY Scotland to miss fuel poverty target The Scottish government has announced that it will not meet its target to end fuel poverty in Scotland by November 2016. It has a statutory duty under the Housing (Scotland) Act 2001 to "ensure, so far as reasonably practicable, that people are not living in fuel poverty in Scotland by November 2016". The most recent figures for 2014 revealed that around 35 per cent of Scottish households remain in fuel poverty, according to national fuel poverty charity Energy Action Scotland. The charity's director, Norman Kerr, said: "Given the Scottish govern- ment's recognition that its fuel poverty target will not be met this year, we are calling on it to widen discussions to include key stake- holders and for there to be public consultation in order to reset the target as soon as possible." Housing minister Kevin Stewart said: "This year we are making available more than £103 million to tackle fuel poverty and improve energy efficiency." Sutherland: 'this has all got far too difficult' I am the customer Alex Laskey "Many energy retailers lack confidence in engagement" Against the backdrop of the recent Competition and Markets Authority report, utilities are under more pressure than ever to put customer interests at the heart of their business models. The notion that consumer engagement is a prerequisite for energy retailers' success is not a new one, but research commis- sioned by Opower and under- taken by IDC Energy insights, surveying energy executives from five major global energy markets, took a deep dive into However, many are address- ing this, with 84 per cent of utility executives investing in customer engagement systems and technologies, and 62 per cent planning to invest in their website or to enhance specific customer experiences. The bottom line is that utilities aren't yet as confident in their engagement abilities as they need to be, but are recog- nising the need for change. Alex Laskey, president and founder of Opower utilities' customer engagement capabilities and investment pri- orities. The results showed that energy retailers are aware of the need to make better use of digi- tal tools to build better relation- ships with their customers, but many lack confidence to deliver the engagement qualities that customers find most valuable. Less than 10 per cent pro- fessed to be "very confident" in most of the 15 capabilities required to succeed in a competi- tive market, but most concerning was that executives are least confident in the three capabili- ties they see as most important: customer analytics, mobile apps and cross-channel consistency. UTILITY WEEK | 8TH - 14TH JULY 2016 | 27

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