Ofgem Winter Outlook Consultation
You wouldn't think it from the beautiful weather we're having, but winter's coming... Image by Stashabella via Flickr
I recently attended the Ofgem Winter Outlook Consultation. At this annual event there are industry speakers from DECC, Ofgem, National Grid and other organisations.
This winter is set to be average according to Chris Train from the National Grid, but he added that it could be slightly colder or wetter – who knows?!
Wholesale gas prices have increased by 90% and power by 44% from September 2010 to January 2011. This shows a strong upward trend in wholesale prices. It's difficult to foresee prices coming down in the long-term.
The government has made a pledge reduce carbon emissions by 80% by 2050, compared to the level in 1990. In order for this target to become a reality the government formed DECC (Department of Energy and Climate Change). DECC is currently running a consultation on Electricity Market Reform (ERM). The Electricity Market Reform is currently in its early stages, but it is very likely that the changes that will be passed through in the next 12 to 24 months and they will add more cost onto energy bills for SMEs. Further information on the white paper is available from DECC.
Ofgem, the industry regulator, is also looking at making some changes to the retail side of the energy industry. They are looking into ways to improve competition in the energy market by helping new energy companies compete in the market.
Another key focus for Ofgem is to improve the ability for business consumers to find the best deals in the market, this means more transparency around contract end dates, and changing the way in which the energy companies notify customers of contract terms and new contract rates. Should these changes they come into practice, they will help SMEs getter a better deal on business energy.
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