Category Archives: Energy News

Loyal Energy Customers To Pay Fair Price From Now

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Around 11 million households who have stayed loyal to energy suppliers on poor value energy tariffs will pay a fair price from today (1 January 2019) thanks to the government’s price cap.

The cap will bring down the amount consumers have been overpaying to energy companies, including the Big Six, by £1 billion a year, starting this winter when households are typically using more energy to heat and light their homes. It will remain in place until at least 2020, while energy suppliers and industry continue to work with the energy regulator Ofgem and the government to build an energy market that works better for all consumers.

Prime Minister Theresa May said:

Our energy price cap will cut bills for millions of families and people across the UK who have been ripped off by energy companies for far too long. From today, money will go straight back into the pockets of loyal consumers, including the elderly and those on lower incomes who feel the pinch more acutely.

But work to tackle this issue doesn’t stop there. We’re working with regulators and industry to ensure that consumers are not unfairly overcharged in the future – whether on their phone bills or their insurance premiums.

Energy and Clean Growth Minister Claire Perry said:

Today marks the end of unjustified price rises on energy bills as this government delivers on time on its promise to protect millions of households from poor value deals, especially the vulnerable.

For too long, suppliers have failed to pass on any savings to their customers, who deserve to pay a fair price for their gas and electricity. Switching supplier is still the best way to find a better deal, but that doesn’t mean customers should be punished for their loyalty.

Bill payers can now be confident that any change to the price cap will be a fair representation of the actual costs of energy, rather than suppliers passing on inefficiencies to their customers or as excess profits.

Following a consultation, Ofgem set the price cap level at £1,137 per year for a typical dual fuel customer paying by direct debit. The amount customers will pay depends on how much energy they actually use, as the price cap sets a limit on how much suppliers can charge per unit of gas and electricity not on overall energy bills.

The cap will also protect around one million households who receive the Warm Home Discount currently protected by Ofgem’s safeguard tariff. Ofgem already caps energy prices through its safeguard tariff for 4 million households on pre-payment meters.

Ofgem will review the level of the cap every 6 months taking into account any changes to the actual costs of providing gas and electricity to energy customers. The first review will take place in early February coming into effect on 1 April 2019.

Dermot Nolan, chief executive at Ofgem, said:

Under the cap, Ofgem will protect consumers from being overcharged and ensure they pay a fair price to heat and light their homes. Consumers can have confidence that any rise in prices in the future will only be down to genuine increases in energy costs rather than supplier profiteering while falls in energy costs will always be passed on to them.

Households who are protected by the cap will be able to save even more money by shopping around for a better deal. In the meantime Ofgem will continue with reforms which aim to deliver a smarter, more competitive energy market which, combined with protection for those who need it, works for all consumers.

The Domestic Gas and Electricity Act, which passed Parliamentary scrutiny and became law on 19 July 2018, put in place a requirement on Ofgem to cap standard variable and default energy tariffs after the Competition and Markets Authority (CMA) found consumers had been overpaying the Big Six an average of £1.4 billion a year.

While the temporary cap is in place, energy suppliers and industry will continue to work with Ofgem and government to build an energy market that works better for all consumers, ensuring they get the best service for a fair price so that everyone reaps the benefits of the move to a smarter, more digital economy.

Other measures designed to deliver the government’s objective of clean, affordable and innovative energy, while tackling fuel poverty, as part of our modern Industrial Strategy include:

  • the rollout of smart meters
  • initiatives to promote smarter and faster switching
  • a joint review with Ofgem on the future of the retail market

 

 

Energy Systems Of The Future – Local Communities To Benefit Sooner

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Just under £10 million Industrial Strategy Challenge Fund investment will support even more people to get value from smart local energy systems.

A new research consortium and funding for business-led innovation projects will speed up the uptake of smart energy systems by local communities to start benefiting from cleaner, cheaper and more consumer-friendly energy.

Funding is by UK Research and Innovation through the Industrial Strategy Challenge Fund for clean energy – a £102.5 million investment in UK industry and research to develop systems that support the global move to renewables.

Rolled out by 2020s

Twelve projects from all across the UK will share £1.5 million to design ground-breaking, local, smart energy systems that are ready for roll out in the 2020s.

They will quickly bring forward energy systems with improved efficiency and productivity, at lower costs, in order to reduce energy bills for consumers and create better user experiences.

Ultimately this should help improve air quality in line with the government’s fifth carbon budget, at the same time as building the UK’s energy supply chain, creating high value jobs and export opportunities.

Projects include:

  • creating an energy marketplace and local trading platform between the predominantly commercial premises in London South Bank and Waterloo, using IoT sensors, predictive algorithms and storage systems
  • maximising existing and planned renewable generation assets in Bridgend, including solar farms and a nearby energy park, to develop a local electricity flexibility market, an electric vehicle charging network and improved service offerings for transport and heat
  • making use of an established energy innovation district group and new digital technologies, such as sensing and control devices, data analytics and artificial intelligence, the Cheshire Energy Hub will better manage energy use by industrial users, decarbonise and lower costs

Developing novel research concepts

To bring forward novel research in local energy systems and accelerate uptake, value and impact, £8 million will go to setting up EnergyREV, an energy revolution research consortium.

The consortium will be led by the University of Strathclyde and include 29 investigators across 22 universities, working to ensure that UK academic expertise delivers impact and a competitive advantage.

It will work closely with the Energy Systems Catapult to provide analysis, evaluation and assessment of the projects funded under the prospering from the energy revolution challenge.

Additionally, EnergyREV will deliver its own strategic research projects that address some of the industrial challenges in developing local, investable, consumer-centred energy approaches.

Improving uptake, value and impact

Professor Stephen McArthur, Deputy Associate Principal for Research, Knowledge Exchange and Innovation, at the University of Strathclyde said:

EnergyREV is excited about its role in supporting innovation in the prospering from the energy revolution programme.

The world-class knowledge, research teams and interdisciplinary expertise available through our university partnership will improve the uptake, value and impact of smart local energy systems.

We are focused on using our novel research to accelerate and help deliver the Industrial Strategy goals and enhance UK competitiveness.

Rob Saunders, Deputy Challenge Director, Prospering from the Energy Revolution, UK Research and Innovation said:

This is an exciting time for energy innovations.

We all rely on energy and we all need it to be cleaner and more cheaper, both as consumers and as a nation. New technologies point towards a new energy future, one of lower carbon and more efficient energy supply, distribution and storage, giving consumers more control.

This energy revolution – a crucial part of the Industrial Strategy – has the potential to unlock investment and create high-quality jobs and grow companies capable of exporting.

 

Swansea Receives £36 Million UK Government Funding For Its Clean Energy Tech Breakthrough

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The Chancellor, Philip Hammond, is announcing new £36 million UK government funding for clean energy innovation in the construction sector.

  • The Chancellor, Philip Hammond, is announcing new £36 million UK government funding for clean energy innovation in the construction sector through the Industrial Strategy Challenge Fund.
  • The funding will go to a consortium led by Swansea University, which develops new building materials and coatings which generate electricity from light and heat.
  • This energy can be used to power homes, hospitals and schools, or be sold back to the national grid.

More than £36 million of UK government funding will be provided to Swansea to support cutting-edge building materials which generate electricity, the Chancellor has announced during a visit to Wales.

The green technology uses light and heat to make energy, and has the potential to power homes, workplaces, schools and hospitals. These materials could replace conventional walls, roofs and windows, generating electricity which is stored and released by a smart operating system. Excess electricity could also be sold back to the national grid.

Today’s announcement supports the government’s mission to at least halve the energy use of new buildings by 2030: making buildings more energy efficient by embracing smart technologies will cut household energy bills, reduce the demand for energy, and boost the UK’s economic growth whilst meeting targets for carbon reduction.

On a visit to Swansea University, Chancellor of the Exchequer, Philip Hammond, said:

Swansea University and the innovative companies working with it are world-leaders in clean energy. The UK government is backing the industries of the future that will deliver jobs and opportunities across Wales. This £36 million new funding will support exciting green technology that could cut energy bills, reduce carbon emissions and create better homes and workspaces.

The funding, through the ‘Transforming Construction’ challenge of the government’s Industrial Strategy, will develop supply chains in the UK and give certainty to leading researchers and students, helping attract more investment and jobs to the local area.

Secretary of State for Business, Energy and Industrial Strategy, Greg Clark said:

This centre has the potential to transform how buildings use energy, turning them from energy consumers into power stations. This £36 million investment in clean energy innovation shows the UK continues to lead the way in cutting emissions while growing our economy.

We are putting our world-leading science and innovation sector at the heart of our modern Industrial Strategy, and have set the ambitious target for investment in research and development to reach 2.4% of GDP by 2027.

Secretary of State for Wales, Alun Cairns, said:

The UK government is committed to leading the world in delivering clean energy technology and this additional investment at Swansea University shows that we are prepared to support innovation in this critical area.

The cutting-edge research being developed at this institution is being translated into practical inventions and techniques that can improve our lives. It truly is science with a purpose.

Today’s funding announcement, on top of the £68 million commitment to Swansea University since 2010, will ensure that Wales and one of its most forward- thinking universities will play a key role in keeping the UK at the vanguard of innovation for years to come.

This new funding is part of the biggest increase in research and development (R&D) investment for 40 years, supporting high-value jobs in emerging industries. Since Autumn 2016, the government has invested an additional £7 billion in R&D – demonstrating clear progress towards the ambition to raise investment in R&D across the entire UK economy to 2.4% of GDP by 2027.

UK Research and Innovation (UKRI) is delivering the funding for the new Centre. UKRI Chief Executive Professor Sir Mark Walport said:

As we move towards a low-carbon economy, we need to explore more efficient ways of generating, conserving and using power and energy.

Active buildings, which integrate solar generation and storage technologies for electricity and heat within their construction, can help to achieve this. The Active Building Centre will work to remove barriers to the large-scale adoption of active buildings on new developments throughout the country.

The UK’s work in this field has been world-leading, and the Centre announced today is an important step towards realising the potential of low-carbon technologies.

Remaining at the forefront of next generation clean energy is a key part of the government’s modern Industrial Strategy, playing a key part in growing our national income while cutting greenhouse gas emissions. Maximising the advantages for UK industry in clean growth, will increase our productivity, create good jobs, and help protect the climate and environment upon which we and future generations depend.

At the same time, the UK government continues its wider support for Wales. This includes:

  • As a result of the recent NHS announcement, the Welsh Government are expected to benefit from a £1.2 billion a year boost to their budget by 2023/24.
  • Autumn Budget 2017 provided a £1.2 million boost to the Welsh Government’s budget.
  • The UK government is investing £615 million for the Cardiff and Swansea City Deals and making progress on growth deals with North Wales and Mid-Wales.
  • The number of people in work in Wales is at a record high level and productivity growth in Wales is the 3rd strongest of all 12 UK regions and nations.

The final funding is subject to agreement of governance arrangements around the new centre.

 

Smart Meters – The Smart Choice

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Smart meters are the next generation of gas and electricity meters and offer a range of intelligent ‘smart’ functions, much like your smartphone and smart TV.

They are being installed across Great Britain as a part of a national upgrade to our energy system.

Smart meters use a secure national communication network (called the DCC) to automatically and wirelessly send your actual energy usage to your supplier. This means households will no longer rely on estimated energy bills or have to provide their own regular readings.

Smart meters put people in control of their energy use by showing them how much energy they use in pounds and pence via an easy to understand In-Home Display.

With accurate information at their fingertips, consumers can easily understand how they can make small changes to the way they use energy in order to use less and save money on their bills. This information can help them choose a better tariff or switch supplier, increasing their savings even further.

Smart meters also communicate directly with your energy supplier meaning you will get accurate bills and only pay for what you use without the hassle of providing meter readings yourself or taking time out of your day to let the meter reader in.

Consumers with smart pre-payment meters will be able to top up directly online, through an app or at the local shop. No more keys or cards, making it much more convenient. The prepay in-home display will have an easy-to-understand screen that will show how much credit is left. So no more late-night dashes out to top up your energy balance.

Smart meters are the building blocks of a smarter energy system fit for the 21st century.

Over 11 million meters are already empowering consumers to reap the rewards of a smarter energy system – with 400,000 more meters benefitting homes and businesses every month. 8 out of 10 of those with a smart meter would recommend them to friends and family.

In the future, consumers will be able to choose for their new smart household gadgets and appliances to talk to their smart meter and help reduce their household bills. For example, your smart washing machine can automatically run at the cheapest time of the day, directed by information coming through your smart meter.

The government is committed to every home and small business being offered a smart meter by end 2020 – you can choose whether to have one or not. There are clear standards of conduct, overseen by energy regulator Ofgem, that require suppliers to treat consumers fairly and not mislead them when marketing the benefits of smart meters to their customers.

What are the benefits of smart meters?

  • smart meters put consumers in control of their energy use, so they can save money on their bills – those savings will be worth more than £1.2 billion a year by 2030
  • they provide easier, accurate billing and will help consumers choose the best deal for them
  • no more estimated billing – something we only seem to tolerate in utilities – no more having to crawl under the stairs or to take time out of your day to provide manual readings to your supplier
  • smart meters are set to be the cornerstone of the smart energy system of the future, potentially saving Great Britain up to £40 billion between now and 2050

What do energy consumers who already have smart meters think?

  • 82% of people with smart meters say they have a better idea of their energy costs
  • 8 out 10 people with smart meters say they would recommend them to friends or family
  • 90% of people with a smart meter say they are satisfied with the installation process
  • hundreds of thousands of energy consumers are choosing to have smart meters in their homes every month

Myths

Myth 1: Smart meters stop people from switching and lock them into one supplier

Fact: That is simply untrue. All consumers can switch whenever they want. In fact households with smart meters are more likely to switch than those who don’t have one, with 23% of people with smart meters switching in the last year, versus 17% without a smart meter.(1)

Myth 2: Smart meters don’t really help you save money

Fact: Not true. More than 80% of people with smart meters have taken steps to reduce their energy use and as a result, cut their bills.(2) It is estimated smart meters will take £300 million off consumer’s bills in 2020, rising to more than £1.2 billion per year by 2030 – an average annual saving of £47 per household.(3) 8 in 10 consumers with a smart meter would recommend one to family and friends.(4)

Myth 3: People are being forced to have smart meters installed

Fact: Not true. Those customers who want to benefit from having a smart meter can have one installed at no extra cost, but installing a smart meter is always the customer’s choice and people have the right to say no.

Myth 4: Suppliers are bullying consumers into having a smart meter installed

Fact: Ofgem has made it clear suppliers must treat customers fairly and their communications must be complete, accurate and not misleading. Ofgem will take up complaints with energy suppliers for customers who feel they are being bullied or coerced into getting a smart meter.

Myth 5: Smart meters can be hacked and are a safety hazard in the home

Fact: Smart meters are secure, with a security system developed by leading experts in industry and government including GCHQ’s National Cyber Security Centre.

Smart meter installations are also making British homes safer. In the past 18 months, over 430,000 safety issues were identified by smart meter installers, unrelated to the smart meter installation, as a result of free visual safety checks, helping to protect households across Great Britain.

Myth 6: Suppliers are installing ‘dumb’ meters that fail when you switch supplier

Fact: All smart meters offer the same smart functions to customers. Some first generation smart meters may lose some smart functionality if consumers switch but 93% of those installed remain unaffected. This issue is only temporary however and all smart meters will retain their full capabilities when they are enrolled into the national wireless smart meter network. This upgrade will begin by the end of 2018 and will happen automatically without the consumer needing to do anything.

Myth 7: Consumers with poor mobile signal can’t get a smart meter

Fact: By the end of the year more than 95% of households will have signal, rising to 99.25% by the end of 2020 – meaning that almost every household who wants one will be able to have a smart meter.

Myth 8: Suppliers aren’t making enough progress on the rollout of smart meters

Fact: Over 400,000 smart meters are being installed every month and 11 million are already operating across Great Britain. Ofgem holds suppliers to account to ensure they are meeting their obligations to roll out smart meters and can fine energy companies for missing targets.

Myth 9: Smart meters can turn off your fridge without you knowing

Fact: No they can’t. It will always be up to consumers to decide when to use their appliances. In the future smart meters will allow consumers to be rewarded when they use appliances at times when energy is cheaper.

Myth 10: Smart meters mean suppliers can charge higher prices without you knowing

Fact: Energy suppliers can only charge prices customers have agreed to – and that won’t change. Customers with smart meters can access tariffs that allow them to get cheaper prices at times when demand is low – but it will always be the customer’s choice.

Smart Meters Only Save UK Households £11 A Year

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MPs have warned that homes fitted with smart meters are only expected to save consumers £11 a year on their energy bills, considerably less than originally anticipated.

Releasing a report into smart meters, a group of cross-party MPs in the British Infrastructure Group of Parliamentarians said the government was likely to miss its own deadline on rolling out the technology to homes.

Conservative MP Grant Shapps, the chairman of the British Infrastructure Group (BIG), said the programme had been “plagued by repeated delays and cost increases, with suppliers now almost certain to miss the 2020 deadline, and programme benefits likely to be slashed even further”.

Speaking on BBC Radio 4’s Today programme, Mr Shapps said one of the reasons for the “mess” was that “first generation” smart meters, which do not always work when a customer switches supplier, will continue to be rolled out until next year.

Smart Energy GB, which is promoting the roll out of the smart meters, said: “All smart meters mean an end to estimated billing and give people a greater understanding of their energy use.