Utility Week

UTILITY Week 6th October 2017

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UTILITY WEEK | 6TH - 12TH OCTOBER 2017 | 27 Customers Eon's plan to scrap standard variable tariffs (SVTs) for smart meter customers does not spell the death knell of the contro- versial default deals and will not help vulnerable customers, Labour's energy spokesman has said. Alan Whitehead, speak- ing at a fringe meeting at last week's Labour conference, gave a guarded welcome to the big six ENERGY Whitehead: Eon SVT scrappage will not help vulnerable customers supplier's announcement that it will no longer roll over smart meter customers on to its SVT. Instead, it will move custom- ers on to a fixed, one-year tariff when their current deal runs out. The Southampton MP told the meeting, which was organ- ised by Energy UK, that Eon's proposal was a "step forward". But he added that it was "by no means the end of SVTs" and was no solution for vulnerable customers struggling to pay their electricity bills. Whitehead added that the "stand-off " between the govern- ment and Ofgem over whether the latter had the powers to introduce a market-wide price cap on SVTs meant that "there isn't going to be a price cap in the near future". Whitehead added that while This week Ofwat to crack down on bad debt in PR19 Research reveals water firms lag sectors such as retail energy and telecoms in tackling debt Ofwat has called on water companies to crack down on bad debt, saying it costs each cus- tomer in the UK £21 a year, and warning companies they will no longer be allowed to pass on those costs aer the next price review, PR19. As bad debt owed to water companies tops £2.2 billion, Ofwat has published a report by consultant PwC that highlights the water sector's poor handling of bad debt compared with other sectors such as retail energy and telecoms. David Black, senior director of Water 2020 at Ofwat, told Utility Week: "Bad debt is something that impacts on all customers because companies recover the cost of bad debt from all customers." He said the upcoming price review would set an effi- cient level of cost for bad debt: "What we'll be doing in PR19 is seeking an efficient level of cost and we'll draw on this report, evidence from other sectors, and evidence of the best practice in the sector and companies that have inefficient levels of bad debt costs will have to bear those costs themselves. "Companies with better and efficient levels will enjoy the benefit of being better performers." Black confirmed that PR19 would not include "glide- paths" to allow companies time to work towards the new, efficient cost of bad debt. He added: "The good news for the sector is there is actually significant scope for improvement and the study has identified a number of areas where the sector could do better… particularly around better use of customer data and understanding who the customers are." KP See Analysis, p16 ENERGY Smaller suppliers raise market share Small energy suppliers now account for almost 15 per cent of the UK electricity market, according to new figures released by the government. The latest energy trends report from the Department for Business, Energy and Industrial Strategy shows their market share increased from 2.7 per cent in 2010 to 14.2 per cent in 2016. Over the same period the aggregated market share of the largest nine suppliers has fallen from 96 per cent to 85.8 per cent. WATER Severn Trent's water given the all-clear Severn Trent has confirmed that the water quality in Tenbury Wells, Worcestershire, is now "back to normal and safe to drink" aer fears a burst water pipe had contaminated the sup- ply in the area. The company carried out "extensive sampling and testing" over two days and last Monday (2 October) its labs confirmed the water had returned to acceptable quality levels. Customers in Tenbury Wells were advised not to use tap water for drinking, preparing food or brushing their teeth while tests were carried out. Severn Trent apologised to customers affected when a pipe burst near Burford the previ- ous Friday. The company said it believed a small amount of floodwater may have got back into the pipe and it could not "guarantee the quality of the water". Around 150 Severn Trent volunteers, as well as people from the Salvation Army and other water companies handed out one million litres of bot- tled water to support affected customers. ELECTRICITY REA calls for EV charging strategy The government has been urged to develop a clear strategy for the development of charging infrastructure to accelerate the take-up of electric vehicles (EVs). In a report, the Renewable Energy Association said the transition could take place much more rapidly than either the gov- ernment or the public expected. The document was produced in response to the government's announcement earlier this year that it would ban the sale of new petrol and diesel vehicles, start- ing in 2040. With the right support, the REA said it believed that EVs and plug-in hybrids could make up 50 per cent of new vehicles sales by 2025. The trade body said central government, in collaboration with local authorities, should launch an EV rollout strategy covering "everything… from building regulations to manu- facturing, power generation and charging infrastructure". Unpaid bills: other sectors do better than water Labour was committed to cap- ping energy bills at £1,000, such a move would be temporary while a wider-ranging reform of the energy market was insti- gated. He said: "Just having a price cap doesn't get you very far." Lawrence Slade, chief execu- tive of Energy UK, told the meet- ing that Eon's proposal was a "step in the right direction".

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