Utility Week

UTILITY Week 28th April 2017

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Customers UTILITY WEEK | 28TH APRIL - 4TH MAY 2017 | 27 SME customers are at risk of being "ignored totally" in the new water retail market, accord- ing to Lord Rupert Redesdale, chief executive of The Water Retail Company. Echoing concerns raised by a number of market participants and observers, Lord Redesdale told Utility Week's sister title Water.Retail he expected retailers to focus on large non- WATER SMEs at risk of being 'ignored totally' in new water retail market domestic customers with multi- ple sites and the potential to pay for added-value services. According to Redesdale, SMEs constitute approximately 90 per cent of business customers in the water market. However, despite their market presence, they are in danger of being "largely forgotten" by retailers, he said. He suggested SMEs may be put off from switching by mini- mal savings, and, for many retail- ers, it may be uneconomic to take them on without a switching fee. "On the present margins, there is a risk that smaller customers will not benefit from better service or have the option to switch to a better deal," he said. Retailer Everflow said it disa- grees. "We are an SME specialist and we think there are huge opportunities for SME customers This week Code change prompts surge in switching 'Out of kilter' switching suggests business customers are fearful of increased energy costs The implementation of P272 on 1 April has succeeded in engaging energy customers and prompting a surge in supplier switching, data shows. The amendment to the energy balancing and settlement code meant that half-hourly meter- ing for most classes of business customer became mandatory at the beginning of this month. According to insight provided by data transfer service provider Electralink, the milestone was preceded by the highest ever number of pre-switch registrations in February and March. Speaking to Utility Week, Electralink's head of network and EMI services, Dan Hopkinson, said this "suggests businesses have done something to be ready for 1 April. I can't think of anything else that is hap- pening in the market at the moment that might have provoked this significant increase in engagement, other than the arrival of half-hourly settlement". Hopkinson emphasised that the pre-switch registra- tions indicate significant proactive engagement from energy customers because they are "outside of the usual contract cycle". "Companies affected by P272 tend to be in 18- or 24-month contract cycles and so we typically see spikes in switching registrations in October and April." Hopkinson said this "out of kilter" spike in switching will be welcome to energy regulator Ofgem because it proves a "significant" increase in customer engagement. However, he questioned what the timing of the switch- ing suggests about the motivation for engagement. "Why are they switching outside of the contract round?" he asked. "They could have just waited for the usual April contract round. It leads me to suspect that they are moving away from increased pricing." JG WATER Retailer Tor Water to target South West A brand-new water retailer – Tor Water – has applied to Ofwat for a water supply and sewerage licence, which would allow the company to participate in the newly opened non-household water retail market. Tor Water is a privately financed limited company based in Exeter, which will focus on the South West of England and seeks to provide an "unsurpassed level of customer service at a competitive price to the consumer". Director Jiro Wilson writes on his LinkedIn profile that he is "building the company around a team who are experts in what they do and how they do it". "We are definitely not an exponent of an existing water authority, so no mutton dressed as lamb to be found with us, and we intend to trade as a new mar- ket entrant in the deregulated non-household water industry." Twenty-two retailers are cur- rently licensed to operate in the non-household water retail mar- ket, which opened on 1 April. A further three, excluding Tor Water, have applied for licences and are awaiting the outcome. ENERGY Bulb announces cut to standard tariff Renewable energy supplier Bulb has thrown down the gauntlet to the rest of the sector by announcing a cut to its standard variable tariff (SVT). The supplier has claimed to be the first to cut SVT prices this year, and reduced its rate by 3 per cent from 24 April, which Bulb claims is due to falling wholesale energy costs. And Bulb has also challenged its competitors to follow suit, saying that if all the other energy companies in the UK cut their SVT rates by the same amount, UK households would save a total of £770 million. Company co-founder Hayden Wood said it was "outrageous that the big suppliers are refus- ing to pass on these savings to customers", as energy costs tumble. ENERGY First Utility expands with trade services First Utility has announced a deal with the on-demand platform BIZZBY, which will give its customers instant access to hundreds of thousands of local service engineers. The new product will be avail- able as part of First Utility Home Services, representing the next step in the independent energy firm's diversification plans. As part of the deal, First Utility will take an equity stake in BIZZBY. A mobile and web app will connect the company's customers to a network of more than 500,000 qualified boiler engineers and electricians, offer- ing real-time pricing, customer reviews, and cashless payment. On line: half-hourly metering now mandatory to both save money and receive better service," said its customer services director Josh Gill. Other retailers – including South East Water Choice, water2business, Source for Busi- ness, Water Plus, Castle Water, and SES Business Water – claim they have specific offerings for SME customers, and will not exclusively be going aer large industrial and commercial users.

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