Five things we learnt from Energy Spectrum | 672

Our Energy Perspective this week considers how an increasingly competitive market is bringing forward new opportunities and new risks for generators, suppliers and consumers alike, as each tries to secure the best value.

This was a landmark week for UK climate policy, with Parliament passing the government’s 2050 net zero legislation, Climate Change Act 2008 (2050 Target Amendment) Order 2019. In our Policy section, we consider how each House debated it and what issues were raised, concluding that this government and future governments will need to set out how this momentous target will be achieved.

BEIS statistics reveal that, in 2017, the number of English households in fuel poverty totalled 2.53mn, representing approximately 10.9% of all English households, a decline from 2.55mn the year previously. Alongside this, we consider National Energy Action’s reaction to the figures and conclude that wider economic factors – lower than average bill increases and greater than average income increases – rather than sector specific activity were the main drivers for this slight fall.

In our Regulation section, we look at Ofgem’s consultation on proposed changes to the generation licence to make it fit for storage facilities. We find that, although this clarification is welcome, the market is already moving on and a generation licence has become the accepted way for storage developers to avoid final consumption levies. However, we welcome the regulator seeking to provide flexibility as well as promoting information sharing.

Ofgem’s Consumer Perceptions of the Energy Market Report for Q1 2019 shows that cost factors remain the main drivers of consumer switching. In our Industry Structures section, we look at the results and conclude that market events can continue to influence consumer perceptions for some months after taking place, including supplier failure, price rises and comparisons of tariffs.