Home / Enzen News

Enzen News

Enzen to Chair EUA Utility Street Works 11 Mar 2014

3 Mar 2014

Enzen are pleased to announce we will be participating in the EUA Utility Street Works Seminar, on 11 March 2014 organised by the Energy & Utilities Alliance (EUA).

Rahul Menon, General Manager (Business Operations), at Enzen will be chairing Session 2 – Delivering Superior Street Works Performance.

Come and visit our stand on the day, we look forward to seeing you there!

For more information or to book your place, please click here.

Ofgem Publishes Guidance on Cost of Capital for DNO’s

17 Feb 2014

Ofgem has today published guidance which will reduce the assumed cost of equity and cost of capital for electricity distribution companies.

The cost of equity is an important financial parameter. Changes to this affect the assumed cost of capital, which determines the return a company can earn on its investment during a price control. We are currently setting the electricity distribution companies’ price controls for 2015 – 2023.

In November, we assessed the business plans from all six distribution companies. We sent five of these plans back as we considered that they could deliver more value for consumers. The companies will resubmit their plans in March. Today we are setting out our baseline assumption of 6% for their cost of equity, resulting in an estimated cost of capital at 3.8% for the first year of the price control, 2015-16. As these companies are yet to resubmit their plans, a decision cannot be finalised at this stage.

When we assessed the business plans, Western Power Distribution (WPD) was the only electricity distribution company deemed suitable to be considered for fast-tracking, as its plans demonstrated clear value for consumers. This meant that in November we consulted on accepting its plans subject to our consultation on calculating equity market returns.

Today’s decision means that to stay in the fast-track process, WPD will need to make an equivalent reduction in its assumed cost of equity to 6.4% resulting in an overall cost of capital estimated at 3.9% for 2015-16.

WPD now has to decide whether to accept these adjustments. If it does not, it will revert to the slow-track process and resubmit plans in March, along with the other five companies.

Story appears courtesy of Ofgem.


Ofwat Pressure Gets Better Deal for Water Customers

11 Feb 2014

Ofwat has welcomed the decision by six water companies to ease the burden on customers in 2014–15 through lower bills.

Half of companies were already facing below inflation increases this year following Ofwat’s 2009 decision on price limits. In October Ofwat called on all companies to consider whether they needed to take up their full allowed increases, in recognition of the difficult economic circumstances facing many of their customers. Six companies (Affinity, Anglian, Southern, United Utilities, Wessex, Yorkshire) have responded by committing to benefit customers by reducing their allowed bill increases in 2014-15.

Cathryn Ross, Ofwat Chief Executive, said:
“It’s our job to make sure customers are getting a fair deal. We know that customers are having a tough time. In the last five years bills have risen with inflation, yet we are well aware customers’ incomes haven’t. We are pleased that a number of companies have heard our call, listened to their customers, and taken action. Ten million households will now benefit from lower than expected bills this April.

“We are now focused on getting the best deal for customers over the next five years.”

Companies today announced that average bills across England and Wales are set to rise by around 2% this year. The bills, which come into effect on 1 April 2014, are the final ones of the current five-year pricing period. Ofwat is currently analysing and challenging companies’ business plans for the period 2015-20. Final decisions on these prices will be made by January 2015, with new bills coming into effect in April 2015.

Story appears courtesy of Ofwat.

Ofwat Publishes Guidance on Risk and Reward

27 January 2014

Ofwat has today published guidance on risk and reward for water and sewerage companies as part of its 2014 price review process.

In December, water companies submitted their plans for the period 2015 – 2020. Ofwat will ‘pre-qualify’ companies in March that have outstanding business plans which pass its tests for outcomes, costs and affordability, and which have demonstrated robust Board assurance. Those companies that ‘pre-qualify’ will need to consider whether to adopt Ofwat’s risk and reward guidance. Any ‘pre-qualified’ companies that choose to adopt Ofwat’s risk and reward guidance will then benefit from a fast-track approval process.

In April, Ofwat’s Board will announce its decision on the quality of all other companies’ plans. Business plans requiring some intervention, will go through a standard process, while any company whose plan has significant shortcomings will be asked to resubmit its plans.

Cathryn Ross, Ofwat’s Chief Executive said: “Our role is to protect customers and ensure that efficient companies are able to finance their functions.

“We have already seen companies responding to our calls to listen to their customers. The guidance that we issued today offers a further opportunity for companies to secure the best possible outcome for their customers.”

Sonia Brown, Ofwat’s Chief Regulation Officer said: “It is important for companies and customers that risks and rewards are appropriately shared between them. This helps companies keep customers’ bills as low as possible and deliver the services that customers need both today and tomorrow.”

“It will be important for boards of water companies to consider this guidance carefully.”

Ofwat is due to make final decision on prices by January 2015. The guidance can be viewed by clicking here.

Story appears courtesy of Ofwat.

Ofgem Appoints Dermot Nolan as Chief Executive

19 Dec 2013

Ofgem has appointed Dermot Nolan as its next Chief Executive. Dermot will take up his role in March 2014. He joins Ofgem from the Commission for Energy Regulation in Ireland where he has been a Commissioner since 2008 and its Chair since May 2011.

Commenting on the appointment, Chairman David Gray said:
“We are delighted to announce this appointment following an open competition which saw a strong field of candidates. Dermot Nolan joins us at a challenging time for the energy industry, and for our work in regulating the sector to protect the interests of consumers, present and future. Dermot’s economic background and wide experience of regulation and competition matters will equip him well for his role as our next Chief Executive. We look forward to working closely with him and offer our warm congratulations.”

Mr Nolan said: ”Energy regulation has never been more important. I am pleased, proud, and looking forward to leading Ofgem as its Chief Executive. Ofgem has a pivotal role to play in protecting consumers’ interests, in promoting good supplier behaviour and in bearing down on costs. Much work is already underway to promote an energy market which is more competitive and works better for consumers. I shall seek to build on these solid foundations laid by Ofgem in tackling the challenges ahead.”

Story appears courtesy of Ofgem

Season’s Greetings

17 Dec 2013

We would like to wish you Season’s Greetings and Happy Holidays, from all of us at Enzen.


South West Water to Freeze Prices Until April 2015

04 Dec 2013

South West Water is to freeze all its standard tariffs and standing charges for consumers and businesses until April 2015 and is also proposing to keep average bill rises below inflation to 2020.

The Exeter-based water and sewerage company is the first in the UK to freeze tariffs for all of its 800,000 customers in 2014/15. Otherwise, customers may have faced rises of four per cent – a £22 increase on the average annual household bill – under the price limits previously agreed in 2009.

This year, the South West was the only region in the UK to see bills tumble – by 7.3% – thanks to the £50 Government contribution for all household customers. The Government has indicated its intention to renew the reduction on an annual basis to 2020.

As part of its WaterFuture investment plan for 2015 to 2020, the company is also proposing to improve services with no overall average bill rises before 2016 and below forecast inflation increases to 2020.

Chief Executive Chris Loughlin said: “We’ve talked to thousands of customers and businesses to prepare the best investment plan we can and they have told us consistently they don’t want to see any erosion in services but are worried by rising household bills now and in the future.

“We can help all household and business customers now by not putting a penny on any of our standard water and sewerage tariffs and standing charges until April 2015.

“We have also re-examined every last detail of our Business Plan to squeeze out more savings while still delivering the improved services and infrastructure homes and businesses need. In addition to next year’s tariff freeze, we now propose to keep the average bill the same to 2016 and keep overall increases below inflation until 2020.”

Regional business and consumer champions have welcomed the tariff freeze.

Charles Howeson, Chair of South West Water’s independent WaterFuture Customer Challenge Panel, said: “This is great news for customers. We’re pleased they have been heard and the company has done something to help everyone while not cutting services and still investing in the region for the long term.”

Tim Jones, Chairman of Devon and Cornwall Business Council, said: “I’m sure thousands of businesses looking at their energy costs will breathe a sigh of relief and welcome this.

“It’s also great to see a company creating new apprenticeships and planning to invest hundreds of millions locally which will support more than 6,000 jobs in the region. This demonstrates that South West Water is a listening business.”

Consumer debt advisor Steve Meakin of Plymouth Citizens Advice Bureau said: “Freezing water prices will mean one less thing to worry about for the thousands seeking help from us. South West Water already has some of the best assistance measures for those most in need but we’re glad to see them going farther and helping all their customers.”

On 2 December, South West Water will formally submit its WaterFuture Final Business Plan to Ofwat for determination in summer 2014.

Story appears courtesy of South West Water

Water Companies Submit Business Plans to Ofwat

03 Dec 2013

 Ofwat has confirmed that water companies have submitted their business plans for the period 2015 – 2020.

Ofwat will now analyse and challenge companies’ plans – and proposed bill changes – to make sure customers get the right level of service for the right price, while ensuring companies can raise finance to continue to invest in the sector.

Jonson Cox, Ofwat’s Chairman said:
“Ofwat challenged companies to listen carefully to their customers in preparing their plans. Our board made clear that current economic circumstances gave companies an opportunity to deliver falling bills in real terms over the coming five years while maintaining substantial ongoing investment.”

Cathryn Ross, Ofwat’s Chief Executive Officer said:
“Ofwat’s job is to make sure that customers get a fair deal from water companies. We will now carry out an independent, rigorous process to analyse and challenge companies’ plans to ensure that happens.”

In April, Ofwat’s Board will announce its decision on the quality of companies’ plans, including how well they have taken account of their customers’ priorities.

Companies which deliver plans that Ofwat judges outstanding across the board will benefit from a fast-track approval process; plans requiring some intervention will go through a standard process while any company whose plan has significant shortcomings will be asked to resubmit its plans.
Final decisions on prices will be made by January 2015, with new bills coming into effect in April 2015.

Story appears courtesy of Ofwat

CIWEM Appoints New Chief Executive

25 Nov 2013

The Chartered Institution of Water and Environmental Management (CIWEM) has announced today that it has appointed Dr. Simon Festing as its new CEO. Dr. Festing will take up his appointment on 1st March 2014.

Originally trained in medicine, Dr. Festing has previously worked at Greenpeace (as a volunteer) and Friends of the Earth. More recently, he has held executive roles as Director of Public Dialogue at the Association of Medical Research Charities and as CEO at Understanding Animal Research. For the past two years, he has occupied the position of Chief Executive at the Society for General Microbiology.

In announcing the appointment, Jim Oatridge, Chair of CIWEM’s Trustee Board, said:
“We are delighted to be able to welcome Simon to lead our Royal Chartered Charity as we enter a new and exciting era of development. CIWEM seeks to energetically and purposefully drive forward our aspirations as a forward-thinking and pace-setting Institution seeking to engage in transforming the long-term landscape in environmental and sustainable natural resource management in the UK and internationally. Simon’s appointment will enhance our capability in delivering our strategic objectives for the benefit of the public, our 10,000 Members working in various sectors globally, key policy makers in governments and financial institutions, and the wider sustainable environmental movement.”

Dr. Festing said:
“I feel very pleased and honoured to be invited to lead the team at CIWEM and to help guide and steer the future direction of this prestigious, 120 year old Chartered body. Organisationally, CIWEM is one of the foremost Institutions in its sector and is ideally placed to deliver its ambitions from its new state-of-the-art headquarters in Saffron Hill, London. I am very pleased to be able to help CIWEM achieve its aspirations.”

Mr. Oatridge stated that the appointment process had attracted interest from more than 150 very capable and experienced individuals, saying: “We are grateful to all those people who took the time and effort to apply for the position. CIWEM’s thorough selection process, with both trustee and staff involvement, helped us reach a unanimous decision from a very strong, capable and well qualified shortlist. I am immensely grateful to the many people who contributed to the outcome we have achieved.”

For the immediate future until Simon Festing takes up his appointment, the Trustee Board of CIWEM has appointed Nigel Hendley as Interim Chief Executive.

Story appears courtesy of CIWEM

Ofgem Challenges Electricity Distribution Companies to Cut Costs

22 Nov 2013

Ofgem has today sent back plans from five of the six companies that own and operate Britain’s local electricity network, as they did not sufficiently demonstrate value for consumers. Western Power Distribution’s (WPD) business plans clearly demonstrate that they are good value for consumers and therefore are eligible to be fast-tracked by Ofgem.

Western Power Distribution, which serves customers in south Wales, the Midlands and the south west of England, is the only company that has achieved eligibility to have its price controls agreed early. WPD’s business plans, which cover the period from 1 April 2015 – 31 March 2023, include around £7bn of total expenditure of which around £3bn is for investment to upgrade and maintain WPD’s network. The distribution element of the electricity bill, which accounts for 19% of the average annual electricity bill, would be reduced for its customers by an average of 11.6% or around £11.30 in 2012/13 prices. *These numbers are based on the cost of equity allowance within WPD’s business plans. The actual return on equity to be applied is subject to our consideration of new information from the recent Competition Commission provisional determination on Northern Ireland Electricity. See Note 1 for more information.

Hannah Nixon, Senior Partner for Distribution said: “We understand that energy costs are a big concern for consumers and we set a high target for demonstrating value for money. We are pleased that nearly all companies have pledged to cut bills, but we feel that most companies can go further in cutting their costs and expect to see further improvements when they resubmit their plans in March.

“Western Power Distribution responded well to Ofgem’s challenge to demonstrate good value and drive improvements for consumers while reducing the distribution part of their bill. I’m very pleased that our new approach to price controls, RIIO, has produced a sea change in how companies approach price controls, with all companies producing a very high standard of business plan that have customers at their heart. WPD was particularly impressive and clearly demonstrated it delivered for consumers on all areas and this is the reason it is eligible for fast-tracking.”

Companies responded positively to Ofgem’s call to deliver investment efficiently, driven in part by the potential to be fast-tracked, with over £2 billion in cost reductions since their initial forecasts in 2012. It is estimated that during the price control total expenditure will be £27bn across all companies, of which around £13bn is for network investment specifically. All of the companies submitted a high standard of business plan and in some areas companies showed real innovation and willingness to push boundaries. For example, several companies set out comprehensive strategies on taking a more active role in helping consumers in vulnerable situations, working with other agencies such as the British Red Cross and National Energy Action.

The improved plans demonstrated that Ofgem’s RIIO price control has been successful in driving down costs, promoting innovation and stakeholder engagement. However, even with the reductions and good initiatives in the business plans, Ofgem believes there is scope for further improvement. The remaining companies will now submit revised plans in March, when we would expect costs to be reduced further.

Since privatisation, Ofgem’s price controls have delivered a 25% improvement in network reliability and seen the electricity distribution network grow by 10%. In RIIO-ED1 Ofgem is building on this good track record by ensuring efficient investment to maintain and upgrade the local grid and setting challenging targets which incentivise companies to deliver further improvements to benefit consumers. In addition, from the start of this price control in 2015, Ofgem is reducing the time at which companies need to pay customers for being off supply from 18 to 12 hours and ensuring payments rise according to inflation.

Story appears courtesy of Ofgem