Product category:
General insurance
News Release from: uSwitch | Subject: Insurance
Edited by the Insidemoneytalk Editorial
Team on 06 June 2007
Energy: Industry Insight from
uSwitch.com
Below is June's 'Energy Industry Insight' newsletter from uSwitch.com.
This edition highlights changes in the market over the past month, as well as expected changes in forthcoming weeks We hope you find this month's edition useful
This article was originally published on Insidemoneytalk on 6 Mar 2007 at 8.00am (UK)
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Geoff Slaughter, Energy Product Manager at uSwitch.com says:
7.8 million British households have joined the battle to cut carbon emissions...
...but lack of information and incentives could be stopping 18.21 million more from joining them
While British Gas drags its heels on 'New Energy Business', Powergen 'Goes Green' - potentially sparking competition from the Big Six.
Rumours suggest that consumers may see summer price rises as wholesale costs increase for suppliers.
Geoff Slaughter, Energy Product Manager at uSwitch.com, predicts: "As the UK looks set to enter a new nuclear age, renewable (green) energy sources are also stepping into the spotlight and are being pushed higher up the political agenda, with G8 members due to meet in June and agree tough new targets on the reduction of greenhouse gas emissions".
""Nuclear is being touted as the only realistic option if the UK wants to keep the lights on and meet carbon emissions targets.
Those who campaigned against it decades ago, and were labelled 'Greenies' for their efforts, will be astonished to see that, in a satirical twist of the tale, nuclear is now being presented as a 'Green' option.
For many, labelling nuclear as a green form of energy is like dressing a wolf up in sheep's clothing - the environmental benefits of minimal CO2 are arguably offset by the uncomfortable issue of what to do with all that radioactive waste.
"Meanwhile, increasing calls for environmentally-based propositions have not gone unheard".
"The major energy suppliers have begun responding by introducing new products that compete directly with the smaller niche providers by offering 100% renewable energy".
"British Gas recently launched its "New Energy Business", but messages on green products have been conspicuous by their absence from its current marketing push".
"However, it is widely expected to reinvent its green offering hot on the heels of the soft launch by Powergen of its "Go Green" product".
"This trend looks set to continue throughout the year with competition for the green pound hotting-up (rather like the planet)." Prices have been falling, but what next? Geoff continues: "As the summer approaches, many customers are beginning to enjoy lower prices, but can we expect this to carry on? In the short term, things look pretty good, with another price cut expected from some suppliers (British Gas has cut prices twice so far this year, while its competitors have only managed one cut)".
"But, there are rumours that further reductions could be held back or might not happen at all".
"Whispers in some circles suggest that prices could actually rise again before the end of the year as wholesale prices are starting to creep back upwards again." Energy News Reviewed: Energy White Paper: Despite an acceptance that Britain must cut carbon emissions and have a secure energy supply, there was little in the Energy White Paper to suggest that this will not result in greater fuel poverty and higher household bills.
While the debate raged over nuclear, experts were also expressing concern over the emphasis on companies and consumers, saying that a big question mark remained over who would be footing the bill.
800 new CS staff for British Gas: British Gas appears to be getting the message about its poor customer service and has started to make moves to raise its game, including bringing in one extra customer service person for every 20,000 customer accounts.
However, it has still got a long way to go after consumers voted it the worst energy supplier in uSwitch.com's latest Customer Satisfaction Report'.
Only 55% of the energy giant's customers are satisfied with its service and only 40% think that it offers value for money.
Scottish and Southern break into water: Ofwat announces that Scottish and Southern Energy is to become the first new water and sewerage company to serve domestic customers since the market was privatised 18 years ago.
It is the first time that a company entering the market will be able to install, own, operate and supply water and sewerage services to households and may be seen as a test of how competition could be injected into the market in the future.
..and into 'green': Scottish and Southern Energy's announcement that it will be rewarding customers for using less energy is an interesting one.
While full details are yet to be published, a scheme that provides energy bill credits in the first year of up to ?100 will appeal to consumers, although they will have to meet certain criteria to qualify.
However, the scheme is not going to be suitable for everyone as it will not simply be a case of cutting down on energy consumption.
It will require initial investment from customers who will be asked to choose from a range of energy efficiency measures such as buying a low energy appliance at around £250 and paying £200 for loft insulation.
They will also have to reduce overall energy consumption by 10%.
Powergen 'in strong position to cut prices again': E-ON's latest trading statement left absolutely no doubt that energy suppliers are benefiting from significantly lower wholesale prices.
The statement provided clear cut evidence that Powergen is in a strong position to cut its prices again.
It highlighted the significant turnaround in wholesale prices, which has contributed to a ten-fold increase in earnings (EBIT) from 43 million euros in the first quarter of 2006 to 436 million euros in the first quarter of 2007.
Homeserve and Dand G Merger: Homeserve's potential ?500 million takeover of Domestic and Generalwould reduce the number of major players but create a contender with the power to challenge British Gas in the home and heating cover market.
For more information visit uSwitch.com or call 0800 093 06 07.
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