energy matters NUMBER 13 • JUNE 2005 The newsletter for ESPO’s energy customers PRICE PREDICTIONS? Don’t even ask, says David Kwiatek, ESPO’s energy team leader IN BRIEF ENERGY prices have rocketed since the turn of the year amid concerns over gas supply and the rising cost of oil – now around 500% higher than in 1999. The power of silence They stayed high as Europe coped with a cold winter and speculative POWER demand drops dramatically whenever trading. The new Emissions Trading market began to bite. What next? there is a nationwide silence. The three-minute silence in early January, in memory of the victims ECONOMY HIT BY it appears that industry is meet summer demand. of the Asian tsunami, saw a drop of 1.3 gigawatts. HIGH OIL PRICES absorbing the pressure – but By contrast, energy prices However, this was nothing compared with the for how long? At the same did not merit a mention in a silence on 14 September 2001 after the attack on Brent blend crude oil time, UK consumer spending UK election campaign the World Trade Centre, when a fall of 2.7 soared to a record $56.51 per is slowing following interest dominated by other issues. gigawatts was recorded. barrel, driven by demand rate rises and increases in from China, concerns over fuel and utility bills. GAS SUPPLY FEARS Fuel production down availability, fuelled by industrial unrest in Nigeria’s SAME IN AMERICA Record oil prices have UK production of both oil and gas continues to oil producing region, an pushed up gas and, in turn, David Kwiatek decline year on year, according to the latest market explosion at a Texan refinery It’s the same story in the power prices. report by the Royal Bank of Scotland. To December and low reserves of gasoline US, where the economy grew Gas prices were also driven 2004, oil production fell by 11.6% and gas by 12.2%. and heating oil in the US. at its slowest pace for two up by concerns over supply - give any meaningful fall in Rising oil prices are having years from January to March UK reserves in the North Sea power prices – which appears are declining, increasing our unlikely. All change at the top October Year Gas Price reliance on imports through The respite may only be FOLLOWING the general election in May, Malcolm interconnectors from Europe temporary anyway, as some Wicks now has ministerial responsibility for and in the form of Liquid analysts believe oil prices energy. Natural Gas (LNG). could reach $105. To add to Two years from now, the the sense of gloom, the UK’s capacity for imports International Energy Agency No role change for Ofgem should increase if all the has published measures that CALLS from some sectors of the to projects ‘in the pipeline’ come governments can use ‘to save widen Ofgem’s powers, to include the offshore as to fruition. In the meantime, oil in a hurry’ if supplies fall well as the inland gas market, were turned down there is little prospect of by as little as one million by the former Energy Minister, Mike O’Brien. prices falling. barrels a day. Supply prices for gas and Against this background, electricity are currently some and the failure of regulators Alarming rise in CO2 30% up on this time last year to identify the more dubious EMISSIONS of CO2 rose by 2.2% in 2003 and 1.5% and up to 77% higher than reasons for high gas prices, in 2004, according to the DTI, so the Government two years ago. the only light at the end of will be forced to rethink its policy if the target of the tunnel is the promise of 20% by 2010 is to be met. OUTLOOK GLOOMY additional interconnector David Kwiatek, ESPO’s energy team leader, says: capacity and LNG storage. “Nearly all the measures to reduce emissions have This snapshot of anticipated wholesale gas prices from October each year Spring usually signals an That, however, is some way shows a stable situation in 1998/9, a sharp rise in summer 2004 and three targeted business consumers rather than the more reasonably stable years. Forward prices from October 2004 show a steep easing in winter prices but off. According to the domestic sector, which must be tackled more rise through this summer, with October 2005 onwards erratically but steadily this year we saw the opposite Commons Trade and Industry aggressively if real inroads are to be made. climbing off the graph. effect thanks to nine power Select Committee, gas Domestic consumers have a vote – do politicians stations being off line at the consumers can expect price have the will?” an economic impact. In the 2005, as rising petrol prices end of March. spikes for another two years UK, manufacturers’ costs rose stifled consumer and A forecast of lower global and we at ESPO see no in March by 11.5% compared corporate spending. demand, increased output by reason to disagree. Nuclear v renewable with last year, the fastest As opinion polls suggested OPEC and news of higher How far will prices go up? is back on the agenda following a rate in 20 years. However, as voters were increasingly inventory levels in the US Better and wiser industry report by energy consultants Oxera. It claims that retail price inflation worried about fuel prices, helped oil ease from its peak figures than I have been a programme of new nuclear build could be around (excluding volatile sectors President Bush pledged to back towards $50 in early made fools of in the last one-third cheaper than the cost of a comparable such as oil, tobacco and food) find ways of helping US May. However, drastic falls in year, so I’m making no level of renewable generation. was simultaneously at 2.4%, refineries increase output to oil and gas are now needed to predictions! A truly EPIC achievement No let up for 2 years A GROUNDBREAKING business centre in HIGH gas and electricity prices are here to stay for at least two more years, Nuneaton, Warwickshire, has been designed to says the Commons Trade and Industry Select Committee. use half the energy of conventional buildings, In March, the Committee published its findings following a five-month reduce C02 emissions by up to two-thirds and enquiry into the unprecedented increases in the wholesale price of gas generate up to 20% of its own electricity. during 2004. It found that rising demand, coupled with declining domestic Standing on a former landfill site, the Eliot gas production, leaves too small a surplus of gas in winter – leading to Park Innovation Centre (EPIC) provides office seasonal price spikes. space for around 50 small companies. It is Over this and perhaps the next two winters, the UK will be in the same supported by steel pipes recycled from North Sea uncomfortable position. Measures may be taken to decrease demand and oil rigs and was built using recycled aggregates customers on interruptible supply contracts may find their gas supply and locally made bricks and blocks. temporarily cut off. Energy consumption is reduced by using hi- The Committee Chairman, Martin O’Neill, said: “There are failures in the tech air handling equipment to cool and heat the market arising from significant problems with physical supply, the lack of building, coupled with high efficiency gas information about supply, the difficulties caused by operating a liberalised heating modules and very low building leakage market in the UK alongside a relatively unliberalised market in Continental rates. Europe and the dearth of traders willing to sell gas into the forward market. Thanks to ‘high thermal massing’ (heavy “These problems are serious enough for us to conclude that the autumn structure, state of the art windows and 2004 price spike, and the recent spike in late February 2005, will be repeated intelligent lighting), Warwickshire County Little wonder, then, that EPIC has gained an over the next two years.” Council estimates that CO2 emissions will be ‘Excellent’ BREEAM (Building Research Nevertheless, the Committee reported some encouraging signs. Planned around 52kg per square metre of floor space, Establishment Environmental Assessment construction of import and gas storage capacity, provision of more compared with benchmarks of 86kg/m2 and Method) rating. information to traders by production companies and the belief that the EU 148kg/m2 for standard and prestige offices. ESPO was called in to advise WCC on Commission is taking the competition issue more seriously, all point to an Added to all these benefits is a 105kW arranging the physical supply connection and eventual improvement. photovoltaic installation on the roof of the negotiating the terms of supply, and is still In the meantime, customers – especially those in industrial and commercial building, which will convert daylight into involved in discussing prospects for potential markets – will get no respite from high gas and electricity prices. electricity. ‘exports’ of surplus electricity. Consumers pay the price – power companies get the profit

WHILST rising oil prices and spiralling energy costs are hitting both domestic and commercial/industrial consumers hard, many power companies made monster profits in 2004. ■ Scottish Power reported an11.5% jump in third-quarter pre-tax profits, bolstered by a large increase in UK customers ■ BP posted record results for last year, up 26% on 2003 ■ Exxon Mobil announced profits of £13.4 billion, the largest ever made by a public company anywhere in the world ■ Shell produced a £9.3 billion surplus, the biggest profit ever made by a UK company ■ Centrica announced an operating profit of £1.23 billion on a turnover of £18 billion, amid accusations of profiteering and despite British Gas losing over a million residential customers. Latest results show the trend continued in the first quarter of 2005, with BP posting an increase of 29%, Exxon 44% and Shell 28%. Allan Asher, chief executive of the consumer watchdog, Energywatch, was enraged by Centrica’s news. “Clearly, British Gas has passed the risk and burden of the wholesale gas price on to its customers,” he said. The only contrast came from British Energy, which lost £349 million for the year to date, reporting an operating cost of £21.50 per megawatt- hour against revenue of only £20.80 and blaming, in part, costly outages at two power stations. Energywatch files Good deal DIY power of help for AFTER much theoretical talk about the potential of ‘super-complaint’ possibly generating power on a domestic scale . . . you will councils soon be able to buy your own INCOMPETENCE in billing by energy suppliers has led to the ESPO has concluded a partnership micro-wind-turbine for just consumer watchdog, Energywatch, filing a pan-sector complaint deal with the Centre for Sustainable under £1,000 and start to the regulator, Ofgem. Energy (CSE) to support local producing your own The super-complaint – the first ever in the energy sector -- authorities in energy management electricity. accuses suppliers of a litany of billing problems, including: and sustainable energy initiatives. Green Alliance is ■ Failing to send out bills for months, or even years The framework agreement covers promoting the case for home- ■ Not bothering to read meters but relying on estimates energy auditing services, policy generation: small, affordable, ■ Ignoring actual meter readings provided by customers development, feasibility studies and roof-mounted wind turbines, ■ Stopping customers switching where there is any debt over £1 staff training. Councils can opt for solar panels and heating ■ Complicated billing formats that leave customers confused whichever service(s) they need, at systems that can produce and unable to make a decision on who is the cheapest supplier. reasonable cost. renewable, low (or even zero) Although the super-complaint is about domestic bills, the One local authority which has carbon heat and power. They issues ring just as true with industrial and commercial recently taken advantage of the say a micro-wind-turbine, no customers. CSE’s expertise is Fenland bigger than a TV aerial or Ofgem has until early July to investigate the claims that District Council. An energy audit satellite dish, will supply suppliers’ poor handling of bills leaves consumers in misery and of 30 council-owned buildings local needs and link into the debt. Last year, the Energywatch helpline handled 40,000 identified energy efficiency national grid via a two-way complaints (nearly two-thirds of all calls) relating to billing improvements which could gate and one meter – and it problems. Even more shocking, suppliers themselves received achieve potential savings of over should be on sale by the end around 60 million calls which, had they been forwarded to £50,000 a year – 17% of the of 2005. Energywatch, would have cost a minimum of £90 million just to existing spend. The measures For more information on answer, let alone deal with or resolve. suggested should also cut roof-mounted systems, and Energywatch’s chief executive, Allan Asher, said: “Billing is the current harmful emissions by also ground-source heat single biggest problem that consumers have with energy 13%, equivalent to 400 tonnes pumps, go to suppliers. The industry has consistently resisted any reform of carbon dioxide per annum. www.greenalliance.org.uk which is why we hope Ofgem will force through a radical To underpin the technical overhaul of the billing process.” energy improvements to be Meanwhile, Energywatch is backing a move by the European made, CSE devised a tailor-made staff SCHOOLS ARE A Parliament to force energy companies to provide accurate and training and energy awareness programme. FIRST-CLASS EXAMPLE detailed bills, giving consumers the information they need to To obtain a copy of the leaflet describing the services on offer as a result of the ESPO- regulate and monitor their energy consumption. CSE partnership, email James Trotter at [email protected] or call him on 0116 265 7924. In Leicestershire, the team which designs new County Council property has been looking into ways of building Brown ups fuel duty green elements into new OFGEM consults on schools. IN HIS March Budget, the Chancellor, Gordon Brown, announced fuel Steve Holliday, Principal duty increases in line with inflation but deferred them until September 1 Engineer, says: “Whilst it’s because of continuing volatility in the oil market. very plausible to make a new school as environmentally- green power Fuel New price Increase friendly as possible, a balance has to be struck between THE energy regulator, Ofgem, is currently consulting on revised Sulphur free petrol/diesel 48.32 p/litre + 1.22 p/litre ‘greenness’ and cost. guidelines for the supply of electricity from renewable sources. Most of the UK’s major energy suppliers offer ‘Green Deals’ to Ultra low sulphur petrol/diesel 48.32 p/litre + 1.22 p/litre “Amongst the most cost- customers who want to use electricity generated from renewables. effective installations are Ofgem’s original guidelines, published in April 2002, are to be updated in Biodiesel 28.32 p/litre + 1.22 p/litre solar panels on roofs and increasing the amount of the light of recent developments. These include the discontinuation of Bioethanol 28.32 p/litre + 1.22 p/litre Future Energy (an accreditation scheme for renewable energy), the insulation to reduce the need for heating. Add to that low- industry’s experience in the first two years of the Renewables Obligation, Rebated gas oil (red diesel) 6.44 p/litre + 1.22 p/litre the introduction of Renewable Energy Guarantees of Origin (REGOs) and energy lighting and you’re the requirements of the new Fuel Mix Disclosure Directive (see Better LPG (Autogas) 12.70 p/kg + 3.70 p/kg well on the way to saving billing on the way, page 4). money.” Natural Gas (road fuel) 10.80 p/kg + 1.80 p/kg All these ideas have been put into practice at Orchard Primary School in Castle Economy drive Takeover for UK ? Donington, Leicestershire, Movers where another innovative THE UK’s largest coal producer is the subject of scheme is also helping to POWERGEN’S parent, E.ON UK, has bought Economy takeover speculation after receiving a tentative protect the environment. & Power’s small and medium sized enterprise portfolio approach from a prospective buyer. It is thought that Steve adds: “Water is going to for an undisclosed sum, reinforcing its position as a shakers UK Coal’s property portfolio, following a spate of become an increasingly leading energy supplier to UK businesses. colliery closures which could provide development important issue, so we are The deal, still to be cleared by the Office of Fair land, is part of the attraction. harvesting rain which runs Trading, will add 40,000 sites to Powergen’s SME Whilst there is no further news as Energy Matters off the roofs, storing it in customer base and bring to 700,000 the combined goes to press, UK Coal’s share price is rising and its tanks and using it to flush number of small and large commercial and new chief executive, Gerry Spindler reports ‘significant the toilets.” industrial customers supplied by Powergen and progress’ in reshaping and structuring the business as Other schools in ESPO’s E.ON Energy. he attempts to lead it back into profitability by 2006. area have switched from UK Coal operates 15 deep and surface mines, traditional heating including the highly productive Daw Mill Colliery in installations to biomass Warwickshire, which supplies washed singles for systems, including wood- ‘Water safe’ says Ofwat ESPO contracts. burning boilers.

SOUTH Staffordshire Water, bought by Bahrain-based EDF puts all Energy into one name IS YOUR SCHOOL First Islamic Investment Bank last November, is in EARNING TOP MARKS? safe hands despite the remoteness of its new owners, THE names of three energy supply companies - says the industry regulator. Ofwat affirms it will ring- London Energy, SWEB Energy and Seeboard Energy – Please write and tell us fence SSF’s water business from other FIIB activities were dropped in April in favour of one single name, and bring it into line with other water companies in about your own DIY energy that of their parent company EDF Energy. The only project and we’ll try to England and Wales, so that customers are protected change customers will see, says EDF, is the name at from any risks associated with the parent company. feature it in the next issue of the top of their bill. Energy Matters. Loading the first turbines to be erected at Scroby Sands offshore windfarm

UK on target – Poo plant in the mire at a price BRITAIN’S first dung-fired power NEWS station is on the brink of closure, despite Renewables generating enough electricity to light THE UK is on course to hit its target of obtaining 10% of the country’s electricity nearly 1,000 homes. from renewable sources by 2010, says the The Holsworthy Biogas plant in north National Audit Office. Devon, which has won several That’s the good news. The bad news is environmental awards, was forced into that it will cost the taxpayer over £1 billion administration in March when the a year by the end of the decade, increasing German company that built it went bust. the price of electricity by around 5%. The plant was also having difficulty complying with operational conditions set by the Environment Agency. However, the administrators said they Wind farms in the were confident of finding a buyer for the business. doldrums The ground-breaking eco-venture got underway in July 2002, using dung MAJOR energy player E.ON has pulled the produced by around 5,000 cows on 28 plug on two wind farm schemes it was local farms. The slurry is fermented for developing in the UK, blaming planning objections and escalating costs. about 20 days, generating methane for the gas-fired generators, and the waste sludge is treated to remove any deadly spores (such as tuberculosis and foot- In deep water and-mouth) before being returned to the farms as fertilizer. THE world’s first deepwater wind farm is to be sited in the Moray Firth, about 70km north east of Inverness. Two five-megawatt turbines, standing in 45 metres of water, High hopes from the will form part of a demonstration programme to prove the technical and high seas commercial viability of deepwater offshore wind energy. ENERGY from the UK’s first large-scale Further south and closer inland, work is sea-based power stations could be fed about to start on a 30-turbine off-shore into the national grid by the end of scheme at Scarweather Sands, 2007, said former Energy Minister Mike off Porthcawl in south Wales. The £120 O’Brien in January as he pledged £42 million project could generate enough clean million from the DTI’S Marine Research energy to meet the average electricity Development Fund to support the wave needs of a city the size of Swansea. and tidal industry. He added: “Harnessing energy from the seas has terrific potential which, Boost for biomass alongside wind and other renewables, will make an increasingly vital FARMERS are being encouraged to grow contribution towards reducing carbon trees and plants which can be used to emissions and diversifying our energy produce energy. Biomass crops such as mix.” willow and miscanthus (a tall, woody grass) could make an important contribution to the 15% of electricity which suppliers must obtain from renewable sources. Official opening: The Great Yarmouth lifeboat took VIPs for a close-up view of the turbines. UK tops wind Larry Whitty, the Food and Farming Minister, has launched a drive to boost power league production and unveiled a grant aid Scroby Sands operational scheme to help landowners harvest, store, ACCORDING to a new report from finance process and supply biomass for power ONE of Britain’s first commercial offshore wind farms started operating in December 2004 and advisor Ernst & Young, Britain is now the generation. He said: “Biomass energy has was officially opened in March by Olympic sailing gold medallist Shirley Robertson and Dr global leader in wind generation. Taking the potential to help combat climate Paul Golby, chief executive of E.ON UK. current and planned onshore and offshore change, boost farm diversification and Scroby Sands, about 2.5 km off the Norfolk coast, cost £75 million to build and is expected to wind potential into account, we are on create more rural jobs.” provide enough electricity for 41,000 homes and save 75,000 tonnes of carbon dioxide from course to see the world’s largest expansion A Government-appointed task force being released into the atmosphere each year. of renewable energy. hopes to stimulate supply and demand in a The information centre in Great Yarmouth, which we reported on in Energy Matters 11, June The UK also shares top ranking with bid to help meet renewable energy targets 2004, has already welcomed over 30,000 visitors and is gearing up for an even busier summer Spain as the world’s most desirable and boost the rural economy. season now that the wind farm is up and running. renewable energy market. CTP one April rules day for BETTA launch Customers give A COMMON set of trading, balancing Hydro-Electric to its distributors to and settlement rules for the whole defray the high costs of bringing power thumbs up to British electricity market came into to the sparsely populated north of year on force on 1 April 2005. Scotland) and replace it with a new tax Energy Minister Mike O’Brien on all electricity suppliers across the launched BETTA – British Electricity UK. ESPO service Trading and Transmission The levy is expected to be EXPERTS from all sectors of the Arrangements – to cover England, Wales 0.013p/kWh and suppliers are certain BEFORE fuel contracts were renewed in April, the energy industry have been and Scotland and create a single to pass this new charge on to energy team asked over 400 of its customers what they searching for solutions to the electricity market for the UK. consumers. Whilst the majority of thought about delivery, invoicing and website pricing. problems encountered by customers ESPO contracts are based on fixed Of the quarter who responded, 74% considered delivery transferring from one supplier to BUT THE JOKE’S ON prices, they usually include provision was good or very good and 78% were very satisfied with another. One year since we reported ENGLAND AND WALES for changes in taxation or duty to be the timeliness and accuracy of invoicing – comparing on the proposed Customer Transfer passed on, so the cost of electricity favourably with ratings of 59% and 77% after the last Programme (Energy Matters 11, In line with BETTA, the DTI is to supplied to sites on ESPO contracts is survey in 2000. June 2004), several scrap Hydro Benefit (paid by Scottish likely to increase by up to 0.3%. Of those who answered the newly-added question ‘how recommendations have emerged. satisfied are you with ESPO’s web site pricing service?’, New processes – to ensure correct 82% said it was ‘good’ or ‘very good’. meter registration, timely meter readings, the provision of ‘core data Norwegians would items’ from the old to the new supplier and the provision for either supplier to engage the other, if no A NEW framework treaty between the spared lengthy negotiations for each “I have never experienced any opening/closing meter reading has UK and Norway paves the way for individual project. been provided – are now awaiting unprecedented co-operation on North Three projects are already underway: problems in the last ten years. ratification before being Sea projects. the Langeled pipeline, which could supply implemented. One small change It means that companies from either up to 20% of the UK’s future gas which should have a positive impact country bringing forward new ideas for requirements, and two small oil fields: You and your suppliers of fuel on the speed of transfer, affecting cross-boundary oil and gas deals will be Playfair in the UK and Boa in Norway. the timescale in which a meter is oils have acted splendidly.” – read, takes effect on June 30. David Kwiatek, ESPO’s energy team leader, says: “There is so much Northampton that can go wrong when a customer Need advice on energy efficiency? transfers to a different supplier, Theatres Trust even though the actual energy is ESPO’s member authorities have an energy manager or department to help with the same. The whole point of the energy efficiency: CTP has been to simplify and formalise the various transfer Cambridgeshire Facilities Management Help Desk 01223 718044 “However,” says energy team leader David Kwiatek, processes at key stages, to ensure Leicester City ask for ‘energy advice’ 0116 254 9922 “more than three quarters of the respondents didn’t the billing situation is correct Leicestershire Melvin Harrison 0116 265 6896 answer this question, leading us to believe they are within six months.” Lincolnshire Nathaniel Dyas 01522 836224 unaware of the web site pricing service. This proves that, by working Norfolk John Cobb 01603 222674 “Those who do use it are obviously impressed, so we together, the industry can make Peterborough City Property Services helpdesk 01733 742424 want to encourage more of our customers to log on for improvements. There are moves to Warwickshire Jacky Lawrence 01926 736324 immediate pricing information.” seek a similar initiative in The energy team is currently reviewing the web site improving billing performance, for For other areas or LAs please see Good deal of help for Councils on page 2, which and looking at future expansion of ESPO’s online service which ESPO, together with gives details of the Framework for Energy Management Services arranged with – watch this space! consumer groups, is lobbying. the Centre for Sustainable Energy – or ask ESPO for guidance. Coal’s position undermined? Joynal joins ESPO team Not so, says Minister COAL usage is set to fall by half accounting for about 34% of UK within ten years as Britain moves power generation – is likely to towards cleaner sources of power, become more expensive as the THE energy team has a new such as wind and gas, according to Emissions Trading Scheme, part of contract support officer. Joynal a study by a group of energy an EU programme to reduce carbon Khan joined ESPO in March after consultants. dioxide emissions by 8% (from 1990 two years with on-line bank McGloskey Group reports that levels) by 2010, sets caps on the Cahoot, where he was responsible reduced demand from EDF, Scottish heaviest polluters. for all aspects of customer service Power, E.ON and other generators Former Energy Minister Mike and training new recruits. will cut the UK’s annual O’Brien appeared much more up- He says: “Cahoot was only set consumption of coal by 34%, from beat about the future of coal which, up four years ago and grew very 48.75 million tonnes in 2005 to as he recently made clear, remains rapidly. When it was taken over 31.95 million tonnes a year, by 2014. a key element of the generation by a Spanish bank, which was a Just over half that reduction will mix. He added: “Using better very positive move, some be down to coal-fired power stations technology to achieve a 10% customers were unhappy and we that have built, or plan to build, improvement in coal-fired plant had to convince them that a desulphurisation plant – including efficiency could reduce carbon bigger bank meant better Europe’s largest, Drax, West emissions by 20%. service. Burton, Cottam, RWE’s Aberthaw, “Coal will continue to be an “ESPO is a completely different E.ON’s Ratcliffe and British important source, provided its kind of business but the same Energy’s Eggborough. environmental impacts can be principles apply. When I came for At the same time, coal – currently measured.” my interview, I was very impressed by the people and the surroundings here and am looking forward to developing my role in the energy team over the coming Transco networks halved months and years.” Joynal, 28, has a degree in THE sale of four of National Grid Transco’s eight gas distribution networks computer science and, after got the green light in January, nearly two years after the company leaving university, had his first In his new role, he will deal very quickly with the intricacies announced its intention to slim its operations. taste of the energy industry with billing queries and is of energy. Ofgem believes that the resulting increased competition could produce working as a project analyst for a hoping to reduce the time it “His experience of customer consumer savings worth an estimated £225 million over the next 18 years. British Gas agent. He lives in takes to resolve them. Team service in the banking sector will Whilst much trumpeted, this works out at only 63p per customer each year Coventry with his wife and 18- leader David Kwiatek says: prove extremely useful as we and is paltry compared to the £2 bn returned to shareholders! month old son and relaxes playing “Joynal has hit the ground develop and improve our own The four networks to be sold are Scotland, North of England, Wales and snooker or park football. running and is getting to grips service.” West and South of England. Water levels to rise Better billing THE water industry regulator, Ofwat, has agreed that water and sewerage companies in England and Wales can increase their prices above inflation on the way levels for the next five years. From April 1, with the biggest increase occurring in 2005-6, water Where does your electricity come from? companies will be charging customers more in order to fund substantial FROM July 2005, electricity suppliers capital investment programmes. Nearly £17 billion needs to be spent on throughout the EU must disclose to maintaining pipes, sewers and treatment works in order to safeguard customers the sources of their supply and the essential customer services and protect the environment. effect of generating that electricity on the Increases vary between the different water companies. Averages (before environment. inflation) for companies in the Midlands and East Anglia are: The Fuel Mix Disclosure Directive, which came into force in July 2004, requires Water company 2005-6 increase Average to 2010 suppliers to give a breakdown – for example how much of the electricity provided in the Severn Trent 11.8% 4.5% previous year was generated by nuclear energy, coal, gas or renewable sources such Anglian Water 3.8% 2.4% as hydro, waves and wind. They must also say what impact there may have been on the Yorkshire Water 5.5% 3.9% environment – for example how much long- lived radioactive waste or carbon dioxide has been created in providing the energy. This information can be included on the supplier’s bill or in an attached leaflet. Most companies appear to be opting for the latter, James becomes a MCIPS although some observers believe it should form part of the bill, as is the case in Spain, Australia and America. JAMES poor marks, Trotter is now with ‘timeliness A new era in billing a fully of billing’ ERA – the Energy Retail Association – is qualified coming out campaigning to improve the billing practice member of the worst. and performance of the main domestic energy Chartered Alarmingly, few suppliers. One of the key features is Institute of suppliers encouraging customers to read their own Purchasing reported meters to reduce the number of estimated and Supply. measuring the bills sent out and thereby reduce the number For his final effectiveness of of customer complaints. ERA’s chief dissertation, the service they executive, Duncan Sedgwick, says the project James provide. is already bearing fruit, with complaints to investigated The emphasis Energywatch down by 22 % last year. supplier does appear to The move could lead to the introduction of performance be changing, a self-regulatory code of practice but is management however, with Where energy saving unlikely to bring about standardised bills. and set out service issues Duncan Sedgwick adds: “The bill is one of the with the becoming few areas of differentiation for companies provocative increasingly means tax saving whose basic product is the same. We want to hypothesis important in encourage differentiation because that will ‘buyer supplier HOMEOWNERS in Cambridgeshire qualify for a rebate of drive standards up. We will strongly resist behaviour has selection and £25, £50 or £100 on their Council Tax bills if they can prove Energywatch’s call for a BSI standard. We driven down (some) suppliers their homes are energy-efficient. don’t believe that is in anyone’s best the level of investing in Fenland District Council is the first local authority in the interest.” service their service country to introduce an Energy Tax Credits Scheme. Five The ERA and Energywatch are clearly at provided by support. hundred applications have already been received and the first odds on this issue – see Energywatch files energy Consumers – rebates are in the pipeline. ‘super complaint’ on page 2. suppliers’. public or Applicants have their homes surveyed by Council Five-minute private sector – technicians to assess how quickly questionnaires aren’t entirely it loses heat and those who score Energy Matters is a customer newsletter published by were sent out to energy buyers (in blameless either. Many look no highest, by improving the fabric of both public and private sectors) and further than price, yet complain their house, qualify for a bronze, suppliers to ascertain the level of loudly when service is below silver or gold award. To get gold, the satisfaction felt and what efforts are expectation! James says: “In many house must also have two sources of being made to measure customer respects the results were revealing renewable energy – for example service. James’ analysis of the but it was gratifying to confirm that solar panels, a biomass boiler, responses – 57 from buyers and ESPO’s approach is up there with combined heat and power, photo- only seven from suppliers – gave the best practice.” voltaic cells or even a wind-turbine. every indication that his hypothesis However, there is no room for Fenland’s energy manager, Eastern Shires Purchasing Organisation was right. complacency. Energy team leader Bruce Pittingale, says: “Few After competition was introduced, David Kwiatek and James were homes will have two sources at Leicester Road, Glenfield, Leicester LE3 8RT everyone focused on prices and the invited to present the findings to the moment but the whole idea is former publicly-owned suppliers the networking and lobbying group to encourage people to take up Telephone 0116 265 7845 needed to provide shareholder LAGUR (Local Authority renewable energy.” returns. It is perhaps not Government Utility Resource). The The scheme is being Fax: 0116 265 7900 • E-mail: [email protected] surprising, then, that service has results will also form the basis of a underwritten until the end of been unsatisfactory, especially weighted evaluation scheme which 2005 by the Energy Savings Trust For the latest energy news, go to our web site considering the complexities of the ESPO plans to introduce later this but the Council hopes it will supply chain. year, ahead of the new EU continue beyond that deadline www.espoenergy.org All nine elements of service Procurement Directive, due in with funding from a private mentioned on the questionnaire got January 2006. energy provider. Printed on chlorine-free paper from farmed forests