SSE Provokes Anger by Hinting at Energy Price Rise

Published by Kate Anderson on May 25th, 2011

On Friday, Scottish & Southern Energy (SSE) caused an uproar after posting a 50-per-cent increase in profits before announcing that it may be necessary to increase domestic prices in the near future.

The energy provider further upset customers by agreeing to a £700 million dividend for investors.

Chief Executive of SSE, Ian Marchant, said: “I hope we don’t have to put them up but we may be forced to. We don’t enjoy doing that but you can only defy the market for so long”.

What Mr Marchant meant by using the words “defy the market” is certainly unclear, as healthy profit margins evidence significant room for improvement so far as energy bills are concerned; indeed, it has been noted that SSE could still enjoy strong profits if wholesale costs increased and domestic prices fell.

Audrey Gallacher, the Head of Energy at Consumer Focus, argued that domestic central heating customers are likely to be “grinding their teeth in frustration” at the news.

Ms Gallacher said: “Customers simply don’t have faith that they are being asked to pay a fair price and Ofgem has shown this lack of trust has firm foundations. As suppliers move to put up prices, the regulator faces its first major test since its market review. If it isn’t satisfied that price rises are fair and that suppliers are making the changes on transparency and service needed, the threat of a Competition Commission inquiry must become a reality”.

SSE claims to have some 10 million customers in the UK and Ireland, where fuel poverty is an increasingly serious concern. As the cost of domestic fuel increases in proportion to declining rates of pay and employment, many households are finding it difficult to afford gas and electricity. Believing that major utilities are inflating costs to protect profit margins is likely to anger and frustrate most if not all consumers.

Homeowners and residents can reduce the cost of domestic energy by conserving power and using gas and oil more efficiently. Tried and tested methods such as turning thermostats down, installing draught excluders, cavity wall insulation and energy-efficient boilers can help to save on fuel bills. More adventurous customers can try installing renewable technologies such air source heat pumps, solar thermal and ground source heat pumps, all of which are eligible for the Renewable Heat Incentive due to be launched in 2012.

Warmer Homes Equal Saved Lives

Published by Kate Anderson on May 17th, 2011

A public health study has suggested that thousands of lives could be saved if homes in Britain were made a little warmer.

Carried out by Professor Sir Michael Marmot and commissioned by the Friends of the Earth, the study claims that as many as 5,500 deaths could be prevented each year if the coldest quarter of Britain’s housing stock were to become warmer.

According to the study, 25,400 excess winter deaths occurred in 2009-2010 – 21.5 per cent of this figure can be ascribed to people living in the UK’s coldest houses. The study further argues that cold homes increase the risk of adolescents suffering mental illness by around 25 per cent, whilst conditions such as rheumatism, arthritis and obesity can be worsened significantly by living in cold dwellings.

Professor Marmot explained: “The many physical and mental health problems linked to cold homes described in this report are distressing. People might be shocked to learn that living in a cold home doesn’t just affect older people – it also has a negative impact on the development and emotional wellbeing of babies, children and teenagers.

“It is unacceptable that some of our most vulnerable people are suffering in cold homes they often can’t afford to heat properly – this could be avoided with the right policies. Upgrading this country’s cold homes would be a double win – improving people’s health and protecting the environment. The evidence is certainly strong enough to recommend action”.

Homes in the UK can benefit from a number of environmentally friendly measures to improve warmth, with cavity wall insulation and double glazing among the most obvious. Double-glazed windows reduce the amount of heat that escapes from a home, whilst cavity walls can be filled with insulation to achieve the same objective.

Lofts and ceilings can also be insulated with energy conservation in mind, which works not only by reducing heat loss but by helping to lower energy bills, as homes stay warmer for longer with less output required of central heating systems.

Unfortunately, fuel poverty is a problem that affects millions of people in the UK at present and, as the cost of domestic energy is set to rise even higher, the situation is likely to worsen.