The boss of Britain’s biggest energy provider has called an end to the era of the big six suppliers that have dominated the market since Margaret Thatcher launched privatisation 30 years ago. Iain Conn, chief executive of Centrica, said the rapid development of technologies such as in-home batteries and cheap solar power married to smart appliances and big data, had already begun to turn the market on its head. “We are on the edge of a revolution,” Conn said. “The big six nomenclature will become passe.” Centrica is the owner of British Gas, which provides a third of households with gas and a quarter with power. As recently as 2012 the company, along with the rest of the big six – SSE, Npower, Scottish Power, Eon and EDF Energy – controlled 99% of the residential energy market. That share has fall en to 85% as millions of customers have defected to a crop of nimble, web-based upstarts. The country’s ageing fleet of fossil-fuelled power plants is being replaced, with a rise in natural gas and electricity imports and a blossoming of small generators. More than 870,000 homes and businesses are now fitted with solar panels. Silicon Valley tech giants, meanwhile, are rolling out smart thermostats and mobile applications to manage consumption. The ability of the industry’s old guard to react has been undermined by the dramatic fall in the price of oil and gas, which has hit their balance sheets hard. Centrica, which also runs power plants and owns oil and gas fields, lost £857m last year. In the first quarter of 2016, it lost 224,000 residential customers.

Times 29th May 2016 read more »

Every household could have to pay an annual “insurance premium” for access to the UK electricity grid, under plans to overhaul the way networks are paid for. Energy regulator Ofgem is worried that people who can afford to install solar panels and generate their own power for much of the day may end up not paying their fair share of the costs of the UK’s electricity pylons and cables. Dermot Nolan, chief executive, told the Telegraph the question of how to charge for networks in an equitable way a “huge challenge” facing the UK energy system in coming years. Currently, the cost of maintaining and upgrading the networks is factored into the prices energy suppliers charge for electricity, accounting for about £140 a year on a typical household bill. Households that install their own panels will need to buy less electricity, so will avoid paying as much toward the costs of the network.

Telegraph 29th May 2016 read more »

Dermot Nolan had been chief executive of energy regulator Ofgem for just one month when, in March 2014, he made the landmark decision to refer the sector for investigation by the Competition and Markets Authority. The inquiry, he said at the time, was a chance to “once and for all clear the air” in an industry plagued by accusations of rip-off prices and profiteering. Since then, the 50-year-old Irishman has, by his own admission, kept a low profile, letting the competition authority take “the front seat” on retail gas and electricity markets. Not any more. With the CMA preparing to issue its final remedies to improve competition by June 25, Nolan has broken cover. “I see it now as being like passing the baton back to the regulator,” he says, in his first major newspaper interview in 18 months. “I am very, very anxious we take that baton and basically make the remedies work.” We want to find something we think consumers will trust and not have a situation whereby they feel overwhelmed. I am very mindful of the risk

Telegraph 29th May 2016 read more »

Leader: The emerging market in renewable energies is heavily subsidised by the government, which means that consumers pay more than once for their energy. Consider the peculiar situation in the wind industry. Green taxes on bills have paid for inefficient turbines that turn so fast in the summer, when least needed, that an additional subsidy is paid to providers to switch them off – lest they overload the grid. To this Alice in Wonderland scenario could soon be added the solar panel insurance premium. Dermot Nolan, chief executive of the energy regulator Ofgem, has told The Sunday Telegraph that houses with solar panels pay lower electricity bills, so are contributing less and less to the costs of maintaining the national grid. One solution, says Mr Nolan, could be that we all have to pay an annual “insurance premium” for access to the UK grid. Some consumers may feel that it’s unfair that th ey should have to pay for keeping the grid running when they are using it less than others. But, counters Mr Nolan, it would surely be felt to be unfair that rich people who can afford to install solar panels end up paying a smaller amount than those who cannot. Incidentally, once the panels are in place, the users can get another consumer-funded subsidy for the power they generate.

Telegraph 29th May 2016 read more »

French nuclear group Areva has broken off talks with Finnish utility Teollisuuden Voima (TVO) over the delayed Olkiluoto 3 nuclear reactor, TVO said on Thursday. An Areva-Siemens consortium and TVO are seeking billions of euros from one another over delays and cost overruns on the EPR reactor originally planned to start operating in 2009 but now expected to open in 2018. The dispute is blocking a planned takeover of Areva’s nuclear reactor division by another state-controlled French utility EDF, which does not does not want to take on any Olkiluoto-related liabilities.

Reuters 26th May 2016 read more »