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UK companies express concerns over government energy policy

A new survey carried out by Npower shows that British businesses lack confidence in the government’s energy policies. Nearly 60% of businesses surveyed felt that the energy policies unveiled by the Government did not reflect industries actual needs.

A further 62% also expressed doubt over the future energy policies that are planned by the current government. This includes the Governments Electricity Market Reform, which aims to move the United Kingdom towards a lower carbon future.

According to the survey’s findings, UK companies are not happy for their existing energy bills to increase so that low carbon energy solutions can be funded; more than 80% of those interviewed stated that the cost of energy is the most important issue for their business, while only 41% said that a low carbon future was their priority.

More than 25% said that they would not welcome their energy bills increasing to help fund lower carbon initiatives, while another 30% stated that it was unlikely that their businesses would be prepared to pay extra for the cost of low carbon solutions.

Wayne Mitchell, head of industrial and commercial at npower, commented:

“This survey has revealed just how sceptical businesses are by the effectiveness and impact of energy policies – the very policies that are going to have far-reaching and long-term impacts on their businesses. As political parties consider their energy manifestos, there is a clear case here for Government and the wider energy industry to work together to better educate businesses about the importance of these policy initiatives in securing the UK’s energy future and the competitiveness of UK plc.

“The cost of energy bills remains the key issue for business leaders. That’s why we are committed to working with businesses across a wide range of sectors to help make their energy budgets as affordable as possible. What we focus on is the long term; we work with our customers to drive down consumption by increasing knowledge of the changing policy landscape and implementing energy solutions.”

Businesses also raised concerns over the Government’s Contracts for differences Initiative. The initiative pays companies a set amount for implementing the use of low carbon technology, however, the majority of businesses expressed concerns over this when it was revealed that the plan would cost UK companies more in energy bills.

The survey was conducted at the same time that Npower launched the 20% Imperative that offers advice to businesses on how they can save money on energy bills.

Ofgem announce smart meter investigation

Three energy companies are to be investigated for their performance relating to the Governments advanced meter rollout scheme. N power, E-on and British Gas have been singled out as the energy companies with the lowest amount of completion rates.

The roll out scheme first began in 2009 and energy firms were expected to take reasonable steps to install the advanced metres into 155,000 business customers in the UK. However, according to Ofgem, only 75% of the installations were completed by the deadline of April 2014.

The three energy companies highlighted by Ofgem have the lowest completion rates, with 40,000 installations still waiting to be carried out.  Even though the deadline has now passed, the energy companies are still obliged to install the metres, and although N Power, E-on and British Gas were the companies with the lowest amount of installations, there are still several energy firms that did not meet the stipulated deadline.

The rollout programme began as the advance metres, or smart meters as they are often known, can help business and domestic households to save money by giving them a better idea of how energy around their homes and businesses is used. The Government estimates that these smart meters will enable companies to save £40 million every year.

Commenting in a press release, Rachel Fletcher, senior partner for Ofgem’s markets division, said:

“We are disappointed in the overall performance of the majority of suppliers concerning the roll-out of advanced meters to business customers. These new meters offer real benefits to customers including saving money through reduced energy consumption and ending estimated billing.”

“Regulatory and government programmes are not optional and failure to meet these in a timely way causes consumer harm. All suppliers can and must learn the lessons from the roll-out of meters for business customers and apply them to the domestic smart meter roll-out.”

Since the commencement of the programme, Ofgem has been responsible for monitoring the energy firms’ progress, and it has consistently told them about the importance of completing the project on time. The investigation will now seek to find out whether or not British Gas, N power and E-on took reasonable efforts to ensure that they met the deadline.

Soon, energy firms are to roll-out a programme  to fit smart meters into domestic households throughout the UK, however, there has been a lot of criticism over these plans as the meters have been shown to not always make the householder significant savings.

Hinkley Point C Power Plant gets state aid approval

The European Commission has approved the Hinkley Point C State Aid case, it was announced this week. The announcement will lead the way for a new nuclear power station being built in the UK – the first for a generation.

The Government says that nuclear power stations such as the one planned at Hinkley will be essential for providing energy security to Britain as the majority of the countries existing stations are due to be decommissioned by 2023.

Building the new power stations is also an essential part of The government plans to reduce energy bills and carbon emissions; the building of the new plant at Hinkley is part of the government’s strategy to create cleaner, greener sources of energy for the future.

Once Hinkley is in use, it will have the power to provide electricity for six million homes, and the Government states that 25,000 construction jobs are to be created as a result.

Energy company EDF will be responsible for the running of the new nuclear power plant, and there are plans to share the benefits with energy customers should the building of the plant come in under budget.

The Government stated that it is continuing to work with EDF to complete the final details of the contract.

Commenting in a press release, Energy and Climate Change Secretary Ed Davey said:

“This is an important next step on the road to Britain’s first new nuclear power station in a generation. While there is much work still to do before a final contract can be signed, today’s announcement is a boost to our efforts to ensure Britain has secure, affordable low carbon electricity in the 2020s.

“After a thorough, detailed and independent analysis of our proposed project with EDF, this decision shows the European Commission agrees that this is a good deal for consumers and enables us now to proceed to the next stage.”

In the coming years, more nuclear plants are planned to replace the current ones, which cause too much pollution. The government says that the new stations will offer the United Kingdom a greater energy resilience and provide cleaner fuel.

It is estimated that building the new stations will save the consumer £90 a year on their energy bills by 2030, and the plant operator will be responsible for all of the costs of decommissioning as well as having to cover some of the costs of waste management.

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