Utility Week

UTILITY Week 14th October 2016

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Customers This week Ofwat tests awareness of market opening Regulator begins national survey to gauge SME understanding of water retail market opening Ofwat will probe awareness among micro, small and medium-sized businesses of the opening of the water retail market in England, now only six months away. The regulator has commis- sioned a national survey to gauge levels of awareness and understanding of this significant change in the water market. Involving almost 2,000 telephone surveys and nearly 100 more in-depth interviews, the survey began on 10 October. The results will be published later this autumn and will provide Ofwat with a clear picture of levels of awareness, broken down by size and type of business and geographical area. The regulator's senior director for communications, Claire Forbes, said: "Ofwat wants to ensure that all eligi- ble customers have access to reliable, impartial informa- tion about the market, free from company influence. This will build customer confidence in the market and enable informed decision-making by customers about their choice of water services retailer." Following due process, the bid to undertake the survey was won by Swansea-based Opinion Research Services. Opinion's head of research, Kester Holmes, said: "In recent years we have worked with the many large utility companies and international energy companies and we know from our experience that to have a better under- standing of how aware customers in business, charities and the public sector are of the forthcoming market is an important factor in its success. This survey comes at a pivotal time in the programme to open the water retailing market to non-household customers." LV ENERGY More must be done with data analytics New research has revealed that only 8 per cent of energy retailers have a customer data analytics strategy that is fit for purpose. Of the retailers surveyed across Europe, 75 per cent said that customer data analytics was a key priority in their business. The research from Delta-ee also found that acquisition and retention, customer engagement and business decision making were the most common benefits that energy retailers were using customer data analytics for. Delta-ee director Jon Slowe said: "European energy com- panies are realising that to succeed in the new energy world, embracing data analytics is criti- cal. It is a vital ingredient to help them grow revenues and profits. "There are no shortage of trials of analytics in the industry – for example, half of our participants have experimented with analysing smart meter or consumption data – but in our view many energy retailers are only at the start of their data analytics journey." PAN-UTILITY Energy supplier eyes water retail market Business energy supplier Corona Energy is looking at the possibil- ity of entering the English water retail market when it opens to competition next year. A spokesperson for the com- pany told Utility Week: "We are currently reviewing opportunities in water but have yet to decide upon how, when and whether to enter the water market." Corona is the third energy supplier to have expressed tenta- tive interest in the market so far. Ecotricity chief executive Dale Vince exclusively told Utility Week last month that the com- pany is interested in the water market, and would look to bring "an eco-approach to water". And Regent Water – a subsid- iary of gas supplier Regent Gas – applied to Ofwat for a water supply and sewerage licence. It said it wants to supply water and offer further services to small, medium-sized and large corporation businesses through independent energy brokers. WATER Portsmouth top for customer service Portsmouth Water has come top of Ofwat's annual service incentive mechanism (SIM) table for 2015/16, up from eighth the previous year. The company's score of 90 out of 100 is the highest achieved since the SIM began in 2010. Wessex Water is again the highest-performing water and sewerage company, with a score of 87, earning it second place for the second year in a row. South- ern Water is bottom of the table. The average SIM score across the sector rose from 81.6 in 2014/15 to 82.5 this year. Gauge: small business water users surveyed UTILITY WEEK | 14TH - 20TH OCTOBER 2016 | 25 Business customers will not see big discounts in the English water retail market "unless suppliers get innovative", Northumbrian Water Group Business managing director Lucy Darch has warned. She said this was a concern because when customers are asked why they would switch, they most oen answer that they would switch for a discount. WATER Discounts in water retail may be too low to encourage switching Speaking at WWT's Water Scotland conference, Darch pointed out that margins in the English market are tight. "[This] does beg the question of what level of discount will be available in England," she added. "I'm imagining some- where between 0 and 5 per cent of potential discounts." She said this differs from Scot- land, where customers get much bigger discounts, with some achieving up to 30 per cent. "I think it will pose a chal- lenge," she said, although not in the multi-site sector where the driver will be the simplicity of having one bill from one sup- plier. Similarly, in regions where there is a separate supplier for water and wastewater, the driver will be bill consolidation. However, Darch said, "if it does come down to straight discounts, then those won't be very compelling". Also at the conference, Darch said she thought the first couple of years in the English market "will be key". "There are already changes stacking up," she said. "We're in the shadow market as of Monday, and every day fresh changes are coming out that we need to make."

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