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New Plan Helps Business Budget for Energy Costs in UK

August 28, 2014 By Karen Henry

npower-logo-energy-manageUK energy firm nPower has launched a new “Fixed: Certainty” plan that provides its customers with fixed energy costs for the duration of their contracts. It is suited for large businesses across the UK to provide budget certainty in a rapidly changing market.

The new plan is in response to the UK government’s Electricity Market Reform (EMR), an energy policy that aims to deliver investment in low-carbon electricity. Last year, nPower conducted a survey of senior energy managers and energy consultants about EMR. The survey revealed that 97 percent of businesses are worried about how the legislation will affect the cost of their energy, and 91 percent are worried about the ability to forecast costs.

The nPower plan comes with a promise not to reconcile against costs that are agreed as fixed. It locks in the majority of the non-commodity elements of bills, including the immediate costs of Contracts for Difference (CfDs), as well as wrapping in the Feed in Tariff and Renewables Obligation costs, both having caused cost uncertainty for businesses in the past. Third-party network charges and meter-related fees are also included in the total fixed cost.

The next milestone in EMR is taking shape, as low carbon contract companies become operational and CfDs and the capacity mechanism are set to go live. nPower is urging UK businesses to respond to these changes in policy to ensure that they remain competitive. With an estimated 40–50 percent of bills now made up of non-commodity costs, nPower’s plan reduces the risk of inconsistent bills for large business customers.

According to nPower, its plan covers current policy impacts; however, it cannot include any new costs imposed by regulations that have not yet been enforced.


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