Dispatches from the Trenches – 3 Key Insights from the 2017 State of the Market Report
In March 2015 OFGEM, the regulatory body for gas and electricity in the UK, concluded after extensive internal research that the British Energy market is not operating nearly as efficiently as it could be. There were concerns raised regarding the lack of opportunities for competition, and regarding the standards of practice within the industry. As a result of their findings OFGEM referred the British Energy market to the Competition and Markets Authority (CMA.)
The CMA concluded their investigations in 2016, and the 2017 State of the Market report is OFGEM’s first annual assessment of Great Britain’s Energy Market since the investigation. The aim of the report is to help provide an evidence-based assessment of the issues affecting British energy, the ultimate objective being to inform those who work within the utilities industry on how to improve their business for themselves, and for their customers.
Having laboriously trawled through the hefty document, here are MAXIMeyes’ 3 Key Insights from the 2017 State of the Market report.
1. INSIGHT: The end of the grip the Big Six have on the Energy Supplier market?
Traditionally the energy market has been dominated by the so called ‘Big Six,’ namely SSE, British Gas, EDF, EON, Scottish Power and nPower. In recent times however we have been seeing an increased amount of business being placed with smaller niche suppliers. These smaller companies tend to specialise in their particular areas of expertise and as such many consumers feel that they offer a better service and value for money over the larger suppliers.
Just 5 years ago the Big Six had control of 95% of the gas and elec markets in Great Britain. Compare this to today where, as a collective, the smaller suppliers have a greater combined market share than any of the big six with the exception of British Gas, as the below graphs demonstrate
OUR ADVICE: Consider switching to a different utility supplier, even if they are not a household name
MAXIMeyes work with over 30 utility suppliers so if you are supplied by one of the Big Six why not put them to the test? Speak with one of our team today to see whether there could be a supplier better suited to your business. You could not only save money, but also time and effort in finding the right supplier for you.
2. INSIGHT: The dawn of the Renewable era is upon us
Traditionally the primary sources for generating electricity have been nuclear power and the burning of coal or natural gas, however as pollution levels rise (along with the wholesale value of coal and gas) we have seen a massive surge in Renewable power generation. Over the last two years we have seen Green energy overtake coal as a generation source, as it is both more efficient and cheaper than the burning of fossil fuels. Renewable sources are now rivalling Nuclear Power in terms of Market share, and should the trends of the last 5 years continue Renewable energy could soon be the primary source of power generation in the UK.
OUR ADVICE: Consider the energy efficiency of your business.
The rise of Green energy is largely due to the greater financial viability of Renewable solutions and the rising cost of traditional ‘Brown’ energy. Sometimes the best way to save money on your energy bills is to simply use less energy through improved efficiency measures.
Our OPTIMeyes team can install and manage onsite power generation and storage technologies at zero upfront cost, with a number of payback options including a share of savings agreement. Speak to a member of the team today to arrange a no cost / no obligation site review.
3. INSIGHT: The utilities industry still suffers from a poor service reputation.
Recent years have seen increases in the levels of competition and innovation in the energy industry, which implies a forward-moving market in which consumers are confident at engaging with energy suppliers.
The reality though is that consumers tend to choose suppliers who they trust because they have been treated well in the past, not because they are being treated well in the present, and customer satisfaction and trust levels have actually seen only very minor increases over the last four years.
OUR ADVICE: Consider working with a consultant to take the pain out of utilities.
MAXIMeyes was founded on the principle of revolutionising the customer experience in the utilities market. Having recognised the challenges and shortcomings of the energy industry we are committed to combatting rogue traders and offering a reliable and honest 360-degree approach to utility management.
If you have had bad experiences in the past, are thinking about employing an energy broker or consultant for your business, or are simply looking for advice or guidance please don’t hesitate to contact our team who will be happy to discuss your utility needs.
Kieron Blundell, MAXIMeyes