UK households wanting to cut their electricity bills this winter have more choice than before with the arrival of taxpayer-owned or backed energy companies. Angelic Energy in north London and Liverpool Energy Community Company are among a number of suppliers launched by local authorities this year to tackle what they see as unfair pricing by the big utilities. Some councils, such as Gateshead in the North East of England, have gone further by building their own power-generation, heat and electricity networks in an effort to reduce the carbon footprints of their facilities and generate revenue by selling power to local businesses. Creeping taxpayer involvement in an energy system that was privatised from 1990 is a trend that is likely to gather pace. The Scottish government will set out detailed plans this year for a public energy company. Nicola Sturgeon, first minister, told the Scottish National party conference last month that energy would be bought through the wholesale market or generated in Scotland and sold “as close to cost price as possible”. Without “shareholders to worry about” or “corporate bonuses” to pay, she said, the public energy company would offer a supplier “whose only job is to secure the lowest price for consumers”. Robin Hood Energy, set up less than three years ago with a £2m loan from Labour-controlled Nottingham city council, supplies more than 100,000 customers. The company is hoping to prove by the end of this financial year that it is possible to be profitable and offer households a cheaper alternative to the large private sector companies. Despite the challenges of operating in an increasingly crowded market, many local energy companies are nevertheless confident they will continue to grow. Sean Rendall, head of operations at Thameswey Group, set up in 1999 by Woking borough council in Surrey, said the company has drawn on council and private funding to build facilities in Woking and Milton Keynes. It has solar and gas “combined heat and power” engines that generate electricity and capture the heat created in the process. It has also installed pipes to transport hot water direct to council buildings and business customers, including retailers and a hotel. Thameswey also has a “private wire” network to bring electricity from its CHP engines to customers, bypassing the National Grid and local distribution networks altogether. This avoids network costs that typically account for about a quarter of ordinary energy bills.
FT 29th Nov 2017 read more »