Utility Week

20 | 15TH - 21ST JUNE 2018 | UTILITY WEEK Customers Analysis W e are well into year two of the open water market, and customers are beginning to benefit from competition. However, many of the challenges that were rife in the first few months remain. Data – inaccurate or incomplete – is still the biggest bugbear for water retail executives and other market participants. It increases costs for those operating in the market and can be a barrier to switching. The amount to which customers are engaging with the market is another big concern for retailers, and opinions differ on whether levels to date are high enough to be able to call the market competitive. Another major issue is the interaction between wholesalers and retailers – or lack of it – which could become a barrier to suc- cess if not sorted quickly. In order that these issues get corrected, Market Operator Services Limited (MOSL) says collaboration is key. In its first annual review, published at the end of May, the mar- ket operator highlights the "successes and lessons learned" during the past 12 months. It also discusses how the industry can address challenges and drive improvements as we head further into year two. Here, Utility Week rounds up some of the key issues and themes that have arisen since our last update in December 2017, and what market players should look out for over the coming months. Data woes Data continues to be a thorn in the side of the nascent market. Last month, Utility Week's sister title Water.Retail conducted a snap survey, which revealed that data continues to be of great- est concern for retail chief executives in the open water market. Forty-three per cent of chief executives and managing directors who responded said quality or incompleteness of data was their main concern. Meanwhile, 14 per cent said the lack of a level playing field was the most pressing issue, while 14 per cent cited the complexity of wholesale tariffs. One respondent said the retail margin was too small to allow retailers a return on investment and, consequently, did not allow significant savings for customers. Another expressed apprehension about the "awful market structure and lack of forethought in almost every area of the market". And respondents were divided on how successful the market has been. One listed the biggest success as the fact that 4 per cent of customers have switched to another supplier, and other customers will have "negotiated a better deal" from their exist- ing supplier. Another agreed, saying that switching had been the biggest success. In stark contrast, other respondents said there had been very limited numbers of customers switching. As a footnote, Water.Retail sent the survey to 18 of the most active retailers in the market and received seven responses. Respondents ranged from small start-ups to incumbent retail arms. This does not claim to be an in-depth piece of research but rather gives a quick snapshot of chief executives' current views of the market. Levels of engagement Market participants are split over whether the levels of customer engagement with Water market progress report Half way through its second year, the competitive market is starting to deliver for those that engage – but many aren't. Lois Vallely looks at where the challenges remain. THE NEW RETAILERS Aquaflow Utilities Aquaflow Utilities received its licence at the beginning of January. Hailing from South Glamorgan, Wales, the retailer claims to be "committed to offering eligible businesses in England and Wales exceptional levels of customer service, a highly competitive pricing strategy and a technology and efficiency-driven approach to reducing their water consumption". Smarta Water Smarta Water is the newest addition to the water market, having been granted its licence in late May. The retailer – part of water and energy consultant Smarta Environment – says it wants to be recognised as "one of the UK's leading water retailers". In its application, it said it was committed to provid- ing a "high quality consistent level of customer service", underpinned by a "competitive pricing strategy" with an "innovative approach to increasing efficiency, improving sustainability and reducing the costs to and for customers". Coca Cola European Partners Coca Cola is the fourth company in England to be granted a self-supply licence by Ofwat, following brewer Greene King, hospitality firm Whitbread and brewery and pub retailer Marston's. In its application, the company said having a self- supply licence would give it a chance to "take more control" over its water use, as well as allowing it to deal directly with suppliers. 15 Number of months market has been open 120k Number of customers who have engaged with the market 48% Awareness among microbusinesses, according to Ofwat 89% Awareness among large customers 972 Number of complaints to CCWater in final three months of 2017/18 824 Number of complaints to CCWater in 12 months leading up to market opening KEY STATISTICS

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