Next April, England will follow Scotland’s lead and give non-domestic water users more choice over which company bills them. Will your business make savings or is that a pipe dream? We ask industry experts from Utilitywise to explain water deregulation.
What is happening in April 2017?
It’s when the water industry in England begins to deregulate and the barriers to competition start to come down.
If you are a business, charity or public sector organisation, it means you will be able to switch the retail part of your water services to your choice of service provider.
Every customer from 1 April will be free agents – you will not have a contract, so you can switch straightaway.
What is Ofwat’s role?
Ofwat is the industry regulator. It is the teeth of a £3 billion industry. To establish the market, Ofwat asked the 14 regional water companies in England to split their businesses between wholesale (the infrastructure) and retail (customer service and billing).
Between now and April, Oftwat has told the water companies they have to declare their intentions.
How have the water companies reacted?
Most of them reacted to deregulation by inflating the wholesale price. But Ofwat has warned them that in 2020, when it rebalances the market, they will have to bring the wholesale price down.
Some (e.g. Thames Water, Southern, and Portsmouth) have already decided not to have a retail division and have informed customers.
United, Severn Trent and Anglian are among those that have decided to create retail arms either to keep hold of their customers or to poach from those that aren’t going retail. Others companies are undecided.
Scotland deregulated its water industry in 2008. What were customers’ attitudes to switching.
At the start, many customers in Scotland were critical of the service they were receiving from the incumbent company, Scottish Water. The government decided to break its monopoly to force improvements.
Customers felt that any alternative was a bonus and were prepared to switch regardless of price. Many did just that.
We think this will also be the case in England. We predict customers will be delighted to have a chance at switching as there’s a groundswell of opinion that the service isn’t as great as the water companies think it is.
What benefits has Scotland seen?
Customers receive a better service, lower prices because the water market is deregulated, and multiple branches or sites can be brought under one bill, which is a big advantage.
They have also benefited from lower CO2 emissions, water efficiencies, and better monitoring and understanding of how they use water.
What will be the benefits of switching in England?
Very much the same. A decrease in price will be minimal at first, as it was in Scotland, but when the market rebalances, that will improve.
In Scotland there was a high margin between the wholesale and retail price at the beginning, so new providers could apply for a licence and enter the market. That won’t happen in England because the margin at the moment is too small. So there won’t be an explosion of new providers.
However, there will be some new names for customers to get to know, as the water companies in England move away from being geographically specific and change the name of their retail divisions. Northumberland Water, for example, will retain its name for its wholesale arm but its retail division is called Wave.
In the meantime, customers will ask ‘then what can you do for me?’ The answer is better service and reduced usage and consumption, particularly if you are offered a multi-utility package i.e. your gas, water, electricity and even telecoms packaged together.
What happens in October this year?
Although the market deregulates in April 2017, prices will be available in October 2016 so you don’t have to wait until next year to do something about it.
Every water company will have to publish their prices to know the margin and split of wholesale and retail. It means you can commit to a company that has the best price.
So is it best to act now or wait?
Act now. We can’t speak for other firms, but you can talk to Utilitywise, provide all your information and get everything in place, then relax knowing that when the switch occurs you will have already chosen and switched over.
The power is in your hands to put your water account where you want. If everyone does nothing, there’s no reason for suppliers to reduce prices.
Why is 2020 significant?
It’s the year when Ofwat instructs the wholesale companies to reduce their price. It means lower bills for customers.
Do you foresee any problems?
People will be confused with name changes as water companies they have known for years use different names for their retail arms.
Another question is whether the billing will be right. In Scotland, many retail providers still don’t know where all their customers are. There are gaps everywhere.
Some water companies will be bad at sending bills, others will be better. We can’t know yet.
What does the future hold?
Margins will be small at the start so we expect prices to sizzle. The real gains will be in better management of water.
Ten years down the line, the future will be multi-utility bills where your water, electricity, gas and even telecoms are packaged in one bill. This is where true savings will lie and it’s a course that Cathryn Ross, CEO of Ofwat, has already recommended in a Daily Telegraph interview.
Utilitywise will be procuring competitive water prices for people while advising on how to reduce consumption and water usage. As far as we know, we’re the only company offering multi-service bundles.
Is Wood Burning Sustainable For Your Home?
Wood is a classic heat source, whether we think about people gathered around a campfire or wood stoves in old cabins, but is it a sustainable source of heat in modern society? The answer is an ambivalent one. In certain settings, wood heat is an ideal solution, but for the majority of homes, it isn’t especially suitable. So what’s the tipping point?
Wood heat is ideal for small homes on large properties, for individuals who can gather their own wood, and who have modern wood burning ovens. A green approach to wood heat is one of biofuel on the smallest of scales.
Is Biofuel Green?
One of the reasons that wood heat is a source of so much divide in the eco-friendly community is that it’s a renewable resource and renewable has become synonymous with green. What wood heat isn’t, though, is clean or healthy. It lets off a significant amount of carbon and particulates, and trees certainly don’t grow as quickly as it’s consumed for heat.
Of course, wood is a much less harmful source of heat than coal, but for scientists interested in developing green energy sources, it makes more sense to focus on solar and wind power. Why, then, would they invest in improved wood burning technology?
Solar and wind technology are good large-scale energy solutions, but when it comes to small-space heating, wood has its own advantages. First, wood heat is in keeping with the DIY spirit of homesteaders and tiny house enthusiasts. These individuals are more likely to be driven to gather their own wood and live in small spaces that can be effectively heated as such.
Wood heat is also very effective on an individual scale because it requires very little infrastructure. Modern wood stoves made of steel rather than cast iron are built to EPA specifications, and the only additional necessary tools include a quality axe, somewhere to store the wood, and an appropriate covering to keep it dry. And all the wood can come from your own land.
Wood heat is also ideal for people living off the grid or in cold areas prone to frequent power outages, as it’s constantly reliable. Even if the power goes out, you know that you’ll be able to turn up the heat. That’s important if you live somewhere like Maine where the winters can get exceedingly cold. People have even successfully heated a 40’x34’ home with a single stove.
Benefits Of Biomass
The ultimate question regarding wood heat is whether any energy source that’s dangerous on the large scale is acceptable on a smaller one. For now, the best answer is that with a growing population and limited progress towards “pure” green energy, wood should remain a viable option, specifically because it’s used on a limited scale. Biomass heat is even included in the UK’s Renewable Heat Initiative and minor modifications can make it even more sustainable.
Wood stoves, when embraced in conjunction with pellet stoves, geothermal heating, and masonry heaters, all more efficient forms of sustainable heat, should be part of a modern energy strategy. Ultimately, we’re headed in the direction of diversified energy – all of it cleaner – and wood has a place in the big picture, serving small homes and off-the-grid structures, while solar, wind, and other large-scale initiatives fuel our cities.
7 Benefits You Should Consider Giving Your Energy Employees
As an energy startup, you’re always looking to offer the most competitive packages to entice top-tier talent. This can be tough, especially when trying to put something together that’s both affordable but also has perks that employees are after.
After all, this is an incredibly competitive field and one that’s constantly doing what it can to stay ahead. However, that’s why I’m bringing you a few helpful benefits that could be what bolsters you ahead of your competition. Check them out below:
One benefit commonly overlooked by companies is offering your employees financial advising services, which could help them tremendously in planning for their long-term goals with your firm. This includes anything from budgeting and savings plans to recommendations for credit repair services and investments. Try to take a look at if your energy company could bring on an extra person or two specifically for this role, as it will pay off tremendously regarding retention and employee happiness.
While often included in a lot of health benefits packages, offering your employees life insurance could be an excellent addition to your current perks. Although seldom used, life insurance is a small sign that shows you care about the life of their family beyond just office hours. Additionally, at such a low cost, this is a pretty simple aspect to add to your packages. Try contacting some brokers or insurance agents to see if you can find a policy that’s right for your firm.
Dedicated Time To Enjoy Their Hobbies
Although something seen more often in startups in Silicon Valley, having dedicated office time for employees to enjoy their passions is something that has shown great results. Whether it be learning the piano or taking on building a video game, having your team spend some time on the things they truly enjoy can translate to increased productivity. Why? Because giving them the ability to better themselves, they’ll in turn bring that to their work as well.
The Ability To Work Remotely
It’s no secret that a lot of employers despise the idea of letting their employees work remotely. However, it’s actually proven to hold some amazing benefits. According to Global Workplace Analytics, 95% of employers that allow their employees to telework reported an increased rate of retention, saving on both turnover and sick days. Depending on the needs of each individual role, this can be a strategy to implement either whenever your team wants or on assigned days. Either way, this is one perk almost everyone will love.
Even though it’s mandated for companies with over 50 employees, offering health insurance regardless is arguably a benefit well received across the board. In fact, as noted in research compiled by KFF, 28.6% of employers with less than 50 people still offered health care. Why is that the case? Because it shows you care about their well-being, and know that a healthy employee is one that doesn’t have to worry about astronomical medical bills.
Unlimited Time Off
This is a perk that almost no employer offers but should be regarded as something to consider. According to The Washington Post, only 1-2% of companies offer unlimited vacation, which it’s easy to see why. A true “unlimited vacation” program could be a firm’s worse nightmare, with employees skipping out every other week to enjoy themselves. However, with the right model in place that rewards hard work with days off, your employees will absolutely adore this policy.
A Full Pantry
Finally, having a pantry full of food can be one perk that’s not only relatively inexpensive but also adds to the value of the workplace. As noted by USA Today, when surveying employees who had snacks versus those who didn’t, 67% of those who did reported they were “very happy” with their work life. You’d be surprised at how much of a difference this could make, especially when considering the price point. Consider adding a kitchen to your office if you haven’t already, and always keep the snacks and drinks everyone wants fully stocked. Doing so will increase morale tremendously.
Compiling a great package for your energy company is going to take some time in looking at what you can afford versus what’s the most you can offer. While it might mean cutting back in other areas, having a workforce that feels like you genuinely want to take care of them can take you far. And with so many different benefits to include in your energy company’s package, which one is your favorite? Comment with your answers below!