Helping you make sense of the energy and water sectors

Market research & Insight

Issue 29

Themes this quarter Challenges for the large suppliers Continued price competition from new entrants as well as increased price transparency following the introduction of CMA measures for microbusinesses have put further strain on the large suppliers. The interim results published for five of the large suppliers in November showed a common theme of static or falling profitability, with Scottish Power and npower noting customer loses and both EDF Energy and E.ON UK reporting lower non-domestic volume sales. Furthermore, npower explicitly stated that it was facing lower margins in B2B customer acquisition. SSE was the only large supplier to report growth in its retail business with operating profit for this part of the business up £9.8mn compared to 2016. However, the supplier is likely to have challenging times ahead with the proposed creation of a “new independent energy supply company” with the merger of SSE’s household retail division with that of npower’s domestic and non-domestic retail businesses. Rebranding activity and investment in customer interfaces The last quarter of 2017 saw a supplier focus on rebranding and marketing. This varied from minor website content improvements to the complete overhaul of company brands. In October, British Gas soft launched its new web-only offering, branded as British Gas Lite, targeting the increasingly competitive TPI-brokered SME electricity market. DONG Energy also announced its intention to change its company name to Ørsted, subject to shareholder approval. Its new branding and website went live in November with a more ...

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