Utility Week - authoritative, impartial and essential reading for senior people within utilities, regulators and government
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26 | 22ND - 28TH JULY 2016 | UTILITY WEEK Customers This week Domestic savings fall short of expectations Water market competition is unlikely to save domestic customers as much as they hope Domestic competition in the water market is unlikely to deliver the savings customers expect on their bills. Although most customers are pro-competition, the average saving they expect on their water bills as a result of competition is 25 per cent, an amount Ofwat says is "unlikely to be available". The regulator has published the initial findings of its cost-benefit review. It found that the majority of people (56 per cent) felt they should have a choice between water suppliers, and that 50 per cent would be inter- ested in switching. When asked how much their water bills would have to fall to convince them to switch, the average was 25 per cent. However, the regulator has suggested that average savings for customers could be as little as £6 a year. "The picture beginning to emerge from our review is that opening the residential retail water market to competition could deliver a wide range of benefits," said Ofwat chief executive Cathryn Ross. "We think there could be savings of up to £6 and, while modest, I'm sure customers would rather have that money in their pocket than not." She pointed out that the benefits are "not only about lower bills". The research suggested that 61 per cent of people believe competition will result in new offers and innova- tion. And 45 per cent said they would switch if retailers offered additional services, even if there was no price saving. LV WATER Plumbing to blame for poor standards A report has revealed that nearly a third of water that fails to meet quality standards does so as a result of poor plumbing practices and sub-standard fittings in private pipes and properties aer the water has been transferred from public mains. The annual report of the Drinking Water Inspectorate for England and Wales (DWI) found that the presence of lead and nickel, and bad tastes and odours are some of the prob- lems that affect drinking water. They are caused by the use of the wrong materials and fittings, or by inadequate protection from water flowing back into internal pipework from house- hold appliances. WaterSafe, the national register for plumbers, is urging homeowners to use approved plumbers to help keep their drinking water supply safe. ENERGY Welfare reform hits utility customers Energy retailers have been urged to help customers struggling to pay their energy bills as a result of welfare reform. A report from Citizens Advice found that 28 per cent of con- sumers on out-of-work benefits and 16 per cent on tax credits were unable to keep their homes warm and a further 14 per cent were behind with an energy bill. The organisation predicts that 15 per cent of prepay cus- tomer self-disconnect from their energy supply at some point. Some 73 per cent of those who self-disconnected during winter 2015/16 were receiving at least one means-tested benefit. The charity expects self-dis- connections to continue as the number of prepay meters being installed increases and welfare reforms continue. PAN-UTILITY Utilities still trail on customer satisfaction Customer satisfaction with utili- ties is on the rise but the sector is still trailing behind most oth- ers, a survey by the Institute of Customer Service has found. The industry scored 73.3 in the latest UK Customer Sat- isfaction Index, a jump of 1.9 points on last year. Although the gap has closed somewhat, from 4.8 points a year ago to 4.1 points now, the utilities sector still scores well below the national average beating only telecommunications. There has been an improve- ment when it comes to satis- faction with the handling of complaints, and the number of customers experiencing a prob- lem in the first place has fallen by 2 per cent. Ross: benefits are 'not only about lower bills' Business Stream has extended a deal to supply water services to 11 House of Fraser stores in England. Last year the retailer switched to Business Stream for three of its flagship stores and will now add eight more includ- ing Guildford, Huddersfield and London Baker Street. The deal comes ahead of full competition in the non- domestic English water market from April 2017. Business Stream chief WATER Business Stream extends House of Fraser deal to eight more stores executive Jo Dow said: "We're delighted that our partnership has been extended following the successful implementation of a range of water efficiency meas- ures designed to support House of Fraser's ambitious sustain- ability goals. "It is very positive news as we gear up to welcome more new customers when the English water market fully opens for competition next year. We are very confident that we can reduce water usage and the associated costs for other businesses as we have done for House of Fraser and many of our other customers across the UK." The arrangement provides wider support on water manage- ment across the whole company to help it understand its water use and improve efficiency, and a validation exercise to ensure accuracy of historic water billing for all of its sites. The Scottish water sup- plier has also been installing automated meter readers into stores across England to meas- ure water consumption every 15 minutes and allow for more accurate billing and identifica- tion of problems. Dow with House of Fraser's Frank Slevin