12.03.10 Ofgem to review loophole in energy price notifications
There is a current loophole in the law that means energy companies only have to inform their customers of a price rise in their energy bills up to 65 days after the rise has been introduced. Now the government wants Ofgem, the industry regulator, to close this loophole and impose a new and more reasonable limit.
The issue was originally brought up by Simon Hughes, the energy spokesman for the Liberal Democrats. He highlighted how unfair it was that energy companies could effectively put up their prices without informing consumers.
A number of possible solutions are currently being considered. One is to force the suppliers to inform their customers before any increases are confirmed. Another is to introduce a much shorter deadline of only a few days rather than the current 65 days.
Joan Ruddock, the Energy and Climate Change Minister, said that price hikes “are difficult at the best of times”, but that some people might not find out for up to 65 days is “utterly unacceptable”. The government has now given its assurance that the 65-day rule will be changed in favour of consumers, despite the fact that energy suppliers could veto any decision that is made.
The energy industry has hit back at the claims, however, with Christine McGourty from Energy UK stating that the majority of customers are advised about any changes to their energy prices “within weeks”, and that the 65-day rule gave companies the means to communicate in the “most cost-effective way - via their bill”.
Despite this, the fact that some people are only informed of price rises up to two months later is clearly a practice that will have to end.
05.03.10 Ofgem launches green energy labels
Ofgem has just launched a new scheme to help consumers find out just how much each energy supplier is dong to cut its greenhouse gas emissions. This is coming into force in the form of a new label which will show whether a provider is ‘green energy certified’.
The aim behind the scheme is to help energy customers see quickly and clearly which providers are doing the most to source extra green power. Ofgem is hoping to convince customers that it is worth paying for renewable energy and now they can clearly see who is doing the most before choosing a supplier.
The label scheme will make it harder for suppliers to make misleading claims about their use of renewable power. Suppliers will now have to demonstrate to a panel of experts exactly what they are doing to increase their sourcing of renewable energy, and can no longer rely on vague claims to get more customers.
Solitaire Townsend, the chairwoman of the panel, said that “only 2% of Britons currently buy green energy”, but she hoped that “a trustworthy label will convince many more to go green.”
Before the introduction of the scheme, many customers may have been paying suppliers for what they thought were impressive green credentials, whereas the suppliers might simply have been meeting their existing targets set by the government.
Surprisingly, some green energy firms are not happy with the new rules. The founder of Ecotricity, a green energy company, said that Ofgem has created an “artificial standard” as some energy firms could still be misleading in their green energy claims.
26.02.10 SSE sees lower demand over winter
You would have thought that the recent cold snap that hit the UK would have seen a surge in power usage across the country as we all fought to fend off the bitterly cold weather. But SSE (Scottish and Southern Energy) has just announced that its customers actually used less gas and electricity over the winter compared to last year.
The second biggest provider of electricity in the UK said that demand for gas was down 5% on last year, and electricity was down 4%.
This was clearly a surprise to many, but it seems that despite the recent cold weather, the winter actually arrived quite late in 2009, so many people held off turning up the heating until later in the year.
But some consumer groups have seen this drop in usage as further evidence of the inability of many people to afford the higher bills they are being forced to pay. As a result they are cutting back on their usage.
The director of uSwitch.com, Ann Robinson, called it “the biggest warning sign yet about the affordability of energy”.
SSE has also announced that it is in line to meet its full-year targets, and that it will see pre-tax profits of £1.29 billion. This is largely due to the increase it has seen in customer numbers, which have gone up by 200,000. It now has 9.75 million customers in total.
The chief executive of the company, Ian Marchant, said that it had performed well in the second half of the year, announcing “solid progress” in its investment projects.
19.02.10 Microgeneration would be popular with bigger finanial incentives
The majority of homeowners in the UK would be happy to install microgeneration systems to generate their own electricity and provide extra power to the grid. However, they would only be prepared to do this in return for greater financial incentives from the government.
These findings comes from the results of a survey commissioned by Friends of the Earth, the Co-Operative Group and the Renewable Energy Association. 2,100 adults were questioned for the survey which sheds light on the changes that are needed to improve the chances of the UK becoming a leader in microgeneration.
According to the survey, 71% of the respondents would consider installing systems if they were given enough money in return. 64% also said that the proposed feed-in tariff was not ambitious enough. This is the premium rate that would be paid to those generating electricity and supplying it back to the grid.
Also revealed by the survey was the fact that 70% of respondents would be prepared to pay an extra 10p on their monthly electricity bills until 2013, on top of the £1.17 increase that has already been proposed.
When they were told that the UK produces the lowest amount of green energy out of 27 EU countries, 82% of the respondents said that this was “unacceptable”. 88% of the respondents also said that more money needs to be spent to develop renewable energy of our own after being told that 80% of the country’s natural gas will come from abroad by 2020.
Andy Atkins from Friends of the Earth said that the public “overwhelmingly wants the government to think big when it comes to small-scale renewable energy”, saying that “our homes, businesses and communities could become green power stations”.
12.02.10 Two onshore windfarms approved by Scottish government
The Scottish Government has just given its approval for two new onshore wind farms to be built, as well as an extension to another existing wind farm. The decision brings Scotland a step closer to reaching its renewable energy targets.
The combined energy produced by the new wind farms will be over 215 MW (megawatts). This will be divided between a 118 MW farm in Lewis, a 52.5 MW farm near Thurso and a 45 MW extension to the existing wind farm near Elgin.
Overall the energy generated will be sufficient to power 100,000 homes, and on top of that it will generate 240 construction jobs.
The largest wind farm will be built at Lewis, which will on its own provide enough power for 55,000 homes, which is nearly four times more than the number of homes on the Western Isles.
The developers of the wind farm, Crionaig Power Application and Beinn Mhor Power Ltd applied for planning permission back in 2004. They have both committed themselves to using labour, materials, plant hire and transport that is locally sourced where possible, and they have also confirmed that they will be paying a percentage of their turnovers to local trusts.
There were some opponents to the Lewis farm, with the John Muir Trust claiming that the farm would lead to the destruction of “yet another area of stunning wildness” with the “huge visual impacts” of the turbines on the landscape.
The energy minister, Jim Mather, said that the schemes are “good for Scotland’s low carbon economy and further examples of the action we need to take now to tackle climate change.”
