Utility Week

UTILITY Week 28th October 2016

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4 | 28TH OCTOBER - 3RD NOVEMBER 2016 | UTILITY WEEK Green levies 'not value for money' The National Audit Office says renewables subsidies levied on customers' bills "have not secured value for money" because the government has "missed opportuni- ties to exploit the full potential of the Levy Control Framework". £3.8bn Cost of the Renew- ables Obligation to consumers in 2016, increasing to £5.2 billion in 2020. £100m Cost of the contracts for dif- ference scheme to consumers in 2016, compared to £2 billion in 2020. £300m Amount consum- ers will pay for the smart meter programme this year, falling to £200 million in 2020. £900m The least consum- ers will end up paying for the capacity market. STORY BY NUMBERS Brexit-fuelled inflation will push up water bills Seven days... T he UK's imminent exit from the European Union is set to push up water bills and hit vulnerable consum- ers hardest, according to Ofwat. Speaking at Utility Week Congress, Ofwat senior director for customers and casework Richard Khaldi warned that costs to consumers are likely to rise in the wake of Brexit as the British economy suffers. Khaldi told delegates that the decline in sterling and the resulting increase in inflation will see bills go up in what he said is a "worrying scenario". "The inflation rate rose to 1 per cent in September and if you look at RPI that's 2 per cent. It is expected to rise to 2.6 per cent by next year. "Water bills are linked to RPI, which means in the short term we could see bills going up. This could pose a very significant challenge to customer legiti- macy and customer trust and confidence in the sector." He added that this would be adding to the "looming afford- ability challenge" for water customers, which is already hitting home. Khaldi told delegates that one in five customers are now reporting affordability issues with their water bills – up from one in eight last year – and that bad debt has increased by 17 per cent to a total of £2.2 billion, equivalent to £21 per house- hold bill. Wessex Water chief execu- tive Colin Skellett warned that Britain's withdrawal from the EU could additionally hit water companies by exacerbating the skills crisis. MB "Peace of mind and no nasty shocks" Good Energy has promised to freeze its gas and electricity prices until at least March 2017. National media Tasmania tops tap water taste test A sample from Barrington in the north of Tasmania beat four other state finalists to the prize of top drop. The sample, provided by TasWater, was named the best tap water in Australia over four other state finalists in a blind taste test. The Tasmanian tipple beat out the New South Wales sample from Bowraville, South Australia's from Morgan, Victoria's from Myrtleford, and Queensland's from Barcal- dine at the competition's final on Wednesday. The Guardian, 19 October MIT sets nuclear fusion record A nuclear fusion world record has been set in the US, marking another step on the long road towards the unlocking of limitless clean energy. A team at the Massachusetts Institute of Technology (MIT) cre- ated the highest plasma pressure ever recorded, using its Alcator C-Mod tokamak reactor. High pres- sures and extreme temperatures are vital in forcing atoms together to release huge amounts of energy. The Guardian, 17 October BP to decide on first green energy invest- ment for five years BP is considering its first signifi- cant new investment in renewable energy for five years, as it prepares to make a decision on expanding its US wind power business by the end of this year. The US production tax credit for wind power will be reduced at the end of the year, and BP is looking at making a commitment before then to benefit from the higher rate. The investment could mean expanding its US wind farms or upgrading its turbines to higher capacity equipment. Financial Times, 16 October £1m Cost of South West Water scheme to improve its Exmouth network, the final phase of which is starting now.

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