Mark Prentice - Energy Action Ireland

Report
Delivering on fuel
affordability
Mark Prentice,
Head of Retail
© Bord Gáis Energy
Innovation = customer benefit
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First to bring choice to residential electricity customers through The “Big
Switch” campaign in Feb 2009
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Over 425,000 customers switched in the first two years
(most successful electricity market entry in the world)
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Since The Big Switch campaign launched, customers have received an average
savings of €208* by switching to Bord Gáis Energy

Over €88m back into household budgets
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Bord Gáís Energy
Bord Gáis Energy Home Team was established in 2010 as the first fully
integrated home energy services proposition for customers to reduce
energy consumption
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Focus on energy efficiency solutions for domestic customers
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Energy efficiency services provided to over 80,000 homes in 2011
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From servicing and repair to boiler replacement, insulation and BER
certification
* Based on average 12% savings Year 1 and 10% Year 2 on standard rate with an average consumption of 5,300 kWh
The Irish Energy Consumer
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Irish Gas Prices are currently amongst the
lowest in Europe
Natural gas prices in purchasing power standards (PPS)
per GJ for household consumers Q1 2011
25
20
However, the economic environment is
impacting on customers ability to pay their
bills:
15
10
5
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Reduce Incomes
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Strained household budgets
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Traditional payment methods unsustainable
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We need to look at policies which reflect the national economic circumstances and the difficult situation which
customers find themselves in
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We need to review the practicalities of introducing debt blocking, as evidenced in markets such as the UK, to allow
suppliers to address the issues with customer in managing their debt AND to avoid the situation of customers, who
need a practical solution, building up large unpaid bills with multiple suppliers
Natural Gas is 24% cheaper than Home Heating Oil*
Bord Gáís Energy
* As per SEAI 1st October 2011 Fuel comparison Kerosene v natural gas
Bulgaria
Hungary
Portugal
Czech Republic
Poland
Source: Eurostat (nrg_pc_202)
Gas continues to be widely available and cheaper than home heating oil.
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Slovenia
Lithuania
Latvia
Slovakia
Spain
Sweden
European Average
Austria
Estonia
Croatia
Denmark
Italy
France
Germany
United Kingdom
Turkey
Belgium
Netherlands
Luxembourg
Ireland
Romania
0
Bord Gais Energy’s Response
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BG Energy, together with SVP, MABS and other suppliers called on the
CER to introduce debt flagging to prevent customers from building up large
debts with multiple suppliers

•
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The Debt flagging initiative was approved by the CER and implemented on 1 st
October 2011
We have also been working closely with customers to assist them in
making repayments

Introduction of new Level Pay in gas & electricity to allow over 50,000 customers
to spread the cost of fuel across the year and avoid large bills in winter

The installation of over 21,000 free Pay As You Go (PAYG) gas meters to allow
customers control their own energy costs - up from 1200 PAYG in 2010

The number of customer entering payment plans with BG Energy has more than doubled between 2010 and
2011 from 31,500 to over 82,000

Over 50,000 calls to/from our customer care team each month: from 12 staff to 90 at a cost of €3m pa

Over 100,000 customers receiving help & support to manage their arrears through PAYG or repayment plans
Even with the hardship faced by customers in the current economic climate, BG Energy has
continued to work with customers to ensure disconnections are held to an absolute minimum

No material increase between 2010 and 2011
Bord Gáís Energy
Pay as You Go case study:
NI Experience
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Significant use of PAYG meters in NI
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Now unrestricted in terms of Regulatory thresholds for numbers
installed
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Supported by NEA, NI Consumer Council and other stakeholders
as a “consumer payment choice”
Consumers view them as a positive payment method (no stigma)
>85% of all gas meters installed outside of gtr Belfast are PAYG
Use for debt avoidance as opposed to debt recovery (unlike GB)
Benefits to consumers
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>60% of gas meters
>40% of electricity meters
Upfront installation means no possibility of debt
Weekly (even daily) payment for fuel = no large, one-off bills
• average vend = c£10
Fuel payment matched to weekly management of finances
Ability to track & manage usage based on known consumption
Increased choice for those in financial exclusion
In RoI, we have installed c7% of gas market on PAYG and will
begin rolling out electricity PAYG meters in February 2012
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We will continue the rollout of PAYG meters to assist customers in
managing their accounts.
Bord Gáís Energy
Smart Metering
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Bord Gáis Energy are in favour of a national roll out of
electricity and gas smart meters
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Trials completed by the CER have shown that smart meters
facilitated an average 2.5% reduction in electricity and an
average 2.9% reduction in gas consumption in homes where
they were fitted. These reductions will mean lower energy
costs for Vulnerable Customers.
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Possible other benefits of smart metering are that it will allow
Suppliers to provide tailored advice and services to customers
to help them reduce their energy costs even further.
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We support the proposals:
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To rollout the meters in a timely and structured approach
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To assist customers in the management of their energy usage
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To provide In Home Display (IHD) units or similar service for
Vulnerable Customers
Bord Gáis Energy will continue to engage in industry working
groups with the CER to ensure the best solution is
implemented for customers.
Bord Gáís Energy
Home Services
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BG Energy Home Team was established in 2010 to be a complete energy
solutions provider for residential customers
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Boiler Replacement & Heating Controls
Central Heating System Upgrades
BER
Attic & Cavity Wall Insulation
BG Energy have developed the Better Home Bonus Package:
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Facilitate SEAI Grants for customers
Avail of the BG Energy Discount
Interest free payments through the customer bill
Average Domestic Consumption
Pre service Efficiency
Heat transferred to Home
Post service Efficiency
13,200 kWh
70%
9,240 kWh
72%
New Consumption
Annual saving in consumption
12,833 kWh
367 kWh
Number of service in 2011
74,445
Total Energy savings
Bord Gáís Energy
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Real demonstrable savings to customers

Average of 77,000 Boiler Services per annum saving our
customers in the region of 27GWh every year through a
comprehensive service scheduling

This equates to a euro savings of approx €1.48m* for our
customers
27.30 GWh
* Based on the standard rate of 5.432c/kWh
Energy Efficiency Improvement Scheme
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Woodview Park Energy Efficiency Improvement Pilot
Scheme

BG Energy Home Team were invited by Dundalk Town Council to
propose & cost measures to improve housing stock in Woodview
Park to C1 BER rating

BG Energy Home Team specified Band A High Efficiency gas
boilers with heating controls package and insulation of lofts & cavity
walls
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Work began in early December 2011 on 44 homes and is on course
to finish by mid February 2012
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27 of the houses are receiving first time gas connections and BG Energy are providing Pay as You Go meters free
of charge to the tenants
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BG Home Team will finalise the project by evaluating the post work BER’s and conducting meetings with the
residents to ensure that customers understand how to utilise their new heating systems to best effect in order to
reduce their spend on energy

Expected returns are between 30-40% savings on energy.
Bord Gáís Energy
* Based on the standard rate of 5.432c/kWh
Summary
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There are significant challenges ahead for consumers and energy providers
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Policies need to match consumer need
Debt blocking?
Pay as you go meter roll-out – what is our ambition?
BG Energy is committed to supporting customers who engage with us in
managing their fuel bills through:
 Payment Plans
 Level Pay
 Pay As You Go meters
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BG Energy is committed to helping give value back to consumers
 Using home energy services to drive down energy usage and resultant bills
Bord Gáís Energy

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