CMA, FiT, RO – the minefield of political and industry acronyms can be enough to confuse even the most diligent energy market watcher. Yet changes in policy and regulation often have a direct or legally-binding impact on business operations, accounting and record-keeping.
We are here to help you navigate the energy policy landscape, digesting the key updates and changes that could impact your business; whether a family-run start-up or a multi-region corporation. From the Government’s review of the energy market to the latest Winter Outlook report, we have digested the most important updates for your business. And we’ll also chart some of the landmarks in the months ahead, so you can stay ahead of the regulatory curve.
Know the powers of the energy ombudsman
During Conservative conference, Energy and Climate Change Secretary Amber Rudd revealed that the Government is planning to work with industry regulator Ofgem and Citizens Advice to enhance the role of the Energy Ombudsman, which investigates customer complaints. In her speech to conference, Rudd said the Ombudsman would be given “real teeth”, enabling it to identify and address “systemic industry-wide problems” where customers were mistreated by energy suppliers.
Is your tariff under review?
The CMA has announced it is to extend its energy market investigation timetable by six months to give it time to consider responses to its provisional findings from suppliers, consumer groups, government and regulators. The statutory deadline is extended from December 2015 to June 2016, although the regulator aims to deliver “well within” this timeframe. It is now planning to publish a provisional decision on remedies in January 2016, with a view to reaching a final decision by the end of April 2016.
Before this announcement, Ofgem issued a response to the CMA’s provisional findings. On whether a ‘safeguard’ tariff – a capped price tariff designed to protect customers who do not choose to leave default tariffs at the end of existing contracts – should apply to the microbusiness market, it said there were important differences between the domestic and microbusiness markets which added complexity to the safeguard tariff design. It added setting an appropriate level for the safeguard tariff in the microbusiness market could be “particularly challenging”. Ofgem also welcomed the CMA’s proposal to introduce further price transparency for microbusiness consumers.
Gas metering changes
Ofgem has approved plans to delay the implementation of Project Nexus, a series of changes to the system which manages gas metering information across the energy industry including key customer data needed for switching and invoicing. The changes will now come into effect on 1 October 2016.
National Grid has published its Winter Outlook report analysing supply and demand for electricity and gas across Great Britain over the winter months. The report states that electricity margins will continue to be tight but manageable throughout the period. National Grid says it has taken appropriate steps to support security of supply through procuring additional balancing services and believes it has the correct tools in place to effectively operate the system.
By Iain Walker, Head of SME, E.ON