Archive for the ‘Utility procurement’ Category

Eight years after water deregulation was introduced in Scotland, April 2017 marks the opening of the English water market to competition. From next year businesses in England can choose their water supplier, opening up opportunities for price cuts and service improvements.

Experience from Scotland shows that savings of up to 25% may be possible, while competition should stimulate water companies to improve their service, billing systems and value added offers (eg around water efficiency). At a minimum, consolidating multiple supplies with a single provider should simplify things.

From October this year businesses will be able to give notice to their incumbent water company that they intend to switch supplier (or at least look at alternatives).

This means now’s the time to audit your water supplies, consumption and cost data to firstly ensure you’re paying the correct rates and haven’t been overcharged, and secondly to ensure you’re best placed to switch supplier next April.

For Thames Water customers change is definitely coming, after the supplier announced it would be transferring all business customers to a new supplier, Scotland-based Castle Water, and withdrawing from the commercial market. Thames will remain a domestic supplier and run the water infrastructure, but from the end of 2016 Castle will take over billing and customer service.

Do get in touch to discuss how E&CM can help.

Advertisements

Ofgem’s long-awaited proposals to regulate energy brokers/consultants came a step closer recently with the release of a draft code of practice, which would require :

  • brokers and consultants to be completely transparent about their fees, the contracts they offer and which suppliers they represent.
  • energy suppliers to only work with brokers who have signed up to the new code

The aim is to protect businesses from misselling and drive up standards in the industry. The strongest enforcement element is the requirement for suppliers to only work with accredited brokers/consultants, which ensures that suppliers and brokers are accountable for delivering a high quality of service.

Since November last year Ofgem has had the power to act against brokers who market their services in a misleading way, but the proposed code would increase the protection for businesses.

What does this mean for you?

With the code not due for implementation until later in the year, there are a few important questions to ask that can help ensure you receive a quality, transparent service:

  • Does the broker cover the entire supplier market, or represent only 1-2 suppliers?
  • How do they get paid? No energy broking service is truly free, so ensure you know whether a commission or fee is included in your contract price – and ensure that the fee is the same regardless of supplier

Reputable consultants and brokers already abide by a code of conduct from either the Association of Cost Management Consultants or Utilities Intermediaries Association.

What does this mean for your broker?

It seems likely that the planned code of conduct and supplier accreditation system will see a reduction in the estimated 1,000 brokers and consultants in the UK.

Suppliers may only accredit brokers who can bring them significant energy volumes in order to maintain quality and minimise administration costs; ensuring that 1,000+brokers are adhering to the code could be expensive, particularly if many only place small energy volumes.

The sector may therefore see a period of consolidation, so it’s worth checking now whether your broker is aware of the draft code of conduct and how they plan to comply.