Water retailers are not in competition with self-supply
Self-supply should not be seen to be in competition with water retailers. The two models cater for different types of customer, says Josh Gill, customer services director at Scottish new entrant Everflow.
It has been great to see that all the retailers that have so far declared their hand, with regard to their English pricing, have opted to include the transparent pricing approach of a wholesale plus management fee as part of their offering. This really provides customers with the clarity and confidence in the new market.
Customers can easily compare different providers at a glance, something that the energy market is still trying to get a handle on. Everflow pioneered this approach in the English market when we released our pricing in November 2016, and the feedback we are getting from customers on the transparency of our service offering has been brilliant so far.
We were also the first water retailer to form a partnership with a customer, CalaChem via their subsidiary Earls Gate Water, to serve them as they gained a self-supply licence. We made the process incredibly simple for them, cutting through the red tape to provide them with a transparent and clear path to gaining their licence. The costs involved in setting up the self-supply licence have been, in every case we have looked at so far, paid back by the savings made in the first year alone.
As proponents of both of these models for working with customers, we really don’t see them in competition with each other, as some retailers have suggested. They cater for two different types of customers; hence why we offer both.
The former provides a standard service whereby we allow customers access to the wholesale rates for a small management fee, ideal for small to medium businesses where water isn’t critical to the operations, income and profit of their business.
The latter, the self-supply model, caters for customers who want access to the wholesale rates, yes, but also want to take complete control over their water supply. They also gain direct communication access to the wholesalers who physically supply them with water allowing both parties to plan and forecast water usage and requirements much better. This can produce good long terms benefits for both companies, without the need for a retailer to mediate.
There will be retailers that challenge this view, there is no doubt, as everyone likes to have the income from a large customer within their portfolio, but we’d encourage any customer to weigh up the best option for them in their individual situation. If we see more retailers offering this service to customers, we’d be delighted.
- 500,000 households could miss out on safeguard price cap National Energy Action warns half a million homes will not be protected under Ofgem’s proposed tariff
- Bristol Water’s chief financial officer resigns Mick Axtell has a 12-month notice period but is looking for his "next opportunity"
- UK and Welsh governments sign water powers agreement Protocol paves the way for the repeal of “outdated intervention powers”