Energy intensive businesses in the UK are experiencing a greater pace of regulatory change than ever before, coming from a variety of sources including Ofgem, the EU and UK Government. David Topping, E.ON’s Director of Corporates, explores some of the drivers behind these initiatives and explains how E.ON is helping its customers navigate the changes.
We’re often told by our large business customers that the current pace of regulatory change is causing a real burden – being both confusing and time consuming to manage.
Many new customer and supplier obligations are being introduced and industry regulation could have a direct impact on your day-to-day operations.
However, there are some benefits for consumers. Some of the changes could alter the way you interact with your supplier or how you view your energy, for example advancements in technology like Smart or advanced meters are driving some significant changes across the industry as the volume and quality of data increases.
While there are many individual changes, they share some common themes:
New obligations are being discussed which will capture both supplier and customer activity and propose to increase transparency in the market through mandatory routine reporting of information on supply, purchases and contracts for some very high-consuming customers.
An example is REMIT (EU Regulation on wholesale Energy Market Integrity and Transparency) which creates a framework for identifying and penalising market abuse across Europe giving consumers, industry and other participants confidence that wholesale energy prices are open, fair and competitive; the foundations of an effectively functioning energy market.
There’s increased focus on efficiency and Co2 emission reductions across the EU – the focus isn’t just on us as an energy supplier, but also on customers.
The efficiency drive will introduce new obligations on customers and suppliers to disclose information about energy usage, and for some customers, new requirements such as the Energy Savings Opportunities Scheme (ESOS) which requires certain businesses to carry out energy audits and consider practical efficiency recommendations.
Demand side response –
With the broad rollout of Smart meters and automated meter readings (AMR), UK consumers will have more information than ever about how and when they use energy.
Many of the changes consider how that information can be used by customers – large corporations and small businesses alike – to change their consumption patterns and potentially benefit through reduced energy charges and third party costs, while helping the networks ensure supply meets demand.
At E.ON we’re committed to helping our customers understand and manage the impact of these changes on their business.
- Regulatory changes are issued for consultation before a decision is reached and it’s important that we reflect in our responses not only the impact on us, but also our customers.
- In 2014 we visited Ofgem with some of our customers so that Ofgem could hear directly from them what increased regulation means for their business
- We let our customers know when a regulatory initiative means that the way we bill or service their account or agree their next contract will change
- Our dedicated account managers work with our customers to make sure they fully understand what’s changing and why
- We’ve introduced new propositions, such as our Energy Toolkit, to help customers monitor their energy consumption and use that information to create energy plans
- We offer end to end solutions to help our customers comply with new regulation – for example for ESOS, we can help from initial assessment through to recommending efficiency savings and installing new equipment. ESOS assessments are provided by Matrix, our energy efficiency specialist company, who are working in partnership with the Carbon Trust. A site survey could identify opportunities that could reduce energy consumption, potentially creating significant savings for the business.