RWE absorbs innogy activities in final move of E.On asset swap

RWE has today (2 July) taken over the activities of innogy, marking the conclusion of its asset swap with E.On.

The German energy company sold its remaining stake in innogy to E.On as part of the deal, but has today integrated innogy’s renewables and gas storage businesses into its own operations, with over 2,700 employees switching over.

“The new RWE has been completed,” RWE’s CFO, Markus Krebber, said. “It is a new, bigger and more diverse company, with a clear goal.

“We have a wonderful starting point: a huge worldwide renewables portfolio, two teams that complement each other perfectly with many years of experience, and a strong investment programme,” he continued.

Innogy’s stake in the Austrian power utility Kelag has also been transferred today, which RWE said supplements the portfolio “perfectly” with its hydroelectric power business.

The swap – which was been in the works since 2018 and was approved in September 2019 by the European Commission- also saw RWE acquire E.On’s renewable energy activities in 2019.

RWE is aiming to be carbon neutral by 2040, and now is largely focused on power generation over its networks business, which has been transferred to E.On.

Meanwhile, E.On saw a sharp increase in its sales and earnings in Q1 2020 which it said was due to its takeover of innogy and npower, a marked improvement in light of the latter causing its net income to fall by 49% in its financial results for 2019.


Centrica launches new Energy as a Service bundle to help businesses build back better

Centrica Business Solutions (CBS) has launched a new Energy as a Service bundle, specifically for those that are looking to make an investment in energy saving technologies.

The capital-free energy generation product is designed to help businesses ‘build back better’ in response to COVID-19.

It will offer a bundle to companies that includes the design, installation and financing of on-site power generation, helping them to decarbonise and reduce their energy bills without the upfront capital expenditure of equipment.

Typically, this would see CBS installing on-site generation technology such as Combined Heat and Power units for a customer, which it will then manage as well as providing any top up electricity or gas needed. The business repays the cost of the technology through the energy savings across the length of the contract.

Additional savings will be made through the use of the generation technologies in wholesale and demand response markets, said CBS.

According to the company, by choosing the bundle, savings can be made in the short term that can then be used to support more long term carbon cutting measures, such as the installation of PV panels or enabling electric vehicles.

“For many organisations, the last few months have been extremely challenging and so reducing costs and improving business resilience will be critical to recovery,” said Alan Barlow, director of UK & Ireland for CBS.

“By helping with the upfront investment in energy solutions, we can support them towards improved energy security and cost savings. Our aim is to support customers who wish to Build Back Better, by transitioning to a sustainable future without the need for significant capital.”


EDF preparing cost-cutting plan worth up to three billion euros: sources

PARIS (Reuters) – French state-controlled utility EDF (EDF.PA) has started preparing a cost-cutting plan worth between 2 and 3 billion euros ($1.13 billion), two sources told Reuters, confirming a report by French newspaper Le Monde.

The savings plan could entail divestments of major assets or a hiring and investment freeze, while seeking cost cuts at all levels, Le Monde said on Monday.

An EDF spokesman told Reuters there was a savings plan in the works, but said it was too early to provide details.

EDF, which operates all of France’s 57 nuclear reactors that account for around 70% of the country’s electricity needs, earlier withdrew its financial targets for 2020 and 2021 as the fallout from the coronavirus outbreak hit key areas of its businesses.


Vattenfall gets green light for 1.8GW Norfolk Vanguard offshore wind farm

BEIS gives nod to huge 1.8GW wind farm proposed by Swedish energy company, as it delays approval for Ørsted’s Hornsea Three project for the fourth time

Vattenfall has been given the all clear to build the mammoth 1.8GW Norfolk Vanguard offshore windfarm off the east coast of England.

Planning consent was granted earlier this week by Business Secretary Alok Sharma, following a decision in June to postpone the decision by a month.

The Swedish energy giant intends to install between 90 and 180 turbines across an area of just under 600 square kilometres located 47 kilometres from the Norfolk coast. The project is expected to generate enough power for roughly 1.95 million homes.

Gunnar Groebler, senior vice-president for Vattenfall’s wind business, said the firm was delighted to clinch planning consent for the development, which is scheduled to come online in the mid-2020s.

“This decision justifies the confidence that we have in the offshore wind sector in Britain, and we’re looking forward to developing the project and benefiting the local community,” he said.

“Decarbonising our economies starts with one of the most essential resources – electricity,” he added. “Today’s news sends a strong signal that the UK is serious about its climate ambitions and is open for business to power a green economic recovery.” 

Vattenfall had previously questioned the government’s plans for the offshore wind sector after suffering a second round of delays to the Norfolk Vanguard project last month.

Norfolk Vanguard’s sister project, the proposed 1.8GW Norfolk Boreas farm, has also been stung by significant delays to the government consenting procedure. In May, the Department for Business, Energy, and Idustrial Strategy (BEIS) extended the examination period by five months to October, citing the cancellation of hearings due to the coronavirus.

Danielle Lane, country manager and head of offshore wind for Vattenfall in the UK, urged the government to speed up its approvals process. “It’s now vital that other shovel-ready renewable and low-carbon projects are also given the go-ahead as soon as possible,” she said. “Delays of even just a month or so can set back big infrastructure developments by years in some cases. The UK has to go much further, much faster, if it’s going to reach its net zero targets.”

Lane stressed that the offshore wind projects promised to deliver a significant boost to the local economy. “Today is also great news for people living locally, who we’ve been working with over the last four years to develop this project,” she said. “They can look forward to a multi-billion pound economic boost, bringing with it hundreds of new long-term jobs, driving forward a green revolution and helping to level up UK opportunities.”

The developer expects Norfolk Vanguard to generate more than 400 jobs in the onshore construction phase and a further 150 jobs once operational, once combined with Norfolk Boreas’ workforce.

Hugh McNeal, chief executive at trade body RenewableUK, commended government’s decision to approve Norfolk Vanguard and urged it to reach a similar conclusion for Ørsted’s 2.4GW Hornsea Three project, which was subjected to further planning delays this week.

“Investments in major clean energy projects like these are great examples of how we can get the economy moving again, and the Secretary of State’s announcement will boost our ability to meet the government’s 2030 target of 40GW of offshore wind,” McNeal said. “The landmark decision on Norfolk Vanguard means the UK is taking a significant step closer towards our net zero emissions target, and confirmation of a positive decision on Hornsea Three will get us there even faster.”

In a blow for the Danish energy developer, BEIS extended the deadline for its decision on the 300-turbine Hornsea Three project to 31 December 2020 for the fourth time on Tuesday.

Sharma confirmed, however, that he was “minded to approve” the project, subject to further information being submitted by the Danish energy company by the end of September. The new decision date, BEIS said, would allow time for further consultations with interested parties after the new information was provided.


BP and Shell Write-Off Billions in Assets, Citing Covid-19 and Climate Change

The moves were seen as a possible turning point as plummeting demand makes big oil companies admit they’re not worth what they used to be.

Two of the world’s largest energy companies have sent their strongest signals yet that the coronavirus pandemic may accelerate a global transition away from oil, and that billions of dollars invested in fossil fuel assets could go to waste.

This week, Royal Dutch Shell said it would slash the value of its oil and gas assets by up to $22  billion amid a crash in oil prices. The announcement came two weeks after a similar declaration by BP, saying it would reduce the value of its assets by up to $17.5 billion. Both companies said the accounting moves were a response not only to the coronavirus-driven recession, but also to global efforts to tackle climate change.

Some analysts say the global oil and gas industry is undergoing a fundamental transformation and is finally being forced to reckon with a future of dwindling demand for its products.

“I think we may look back on this as the turning point, the moment the industry finally started to say that real assets with real dollar figures associated with them are likely to be ‘stranded'”—or left undeveloped—”in a decarbonizing world,” said Andrew Logan, senior director of oil and gas at Ceres, a sustainable business advocacy group that has represented major investors in their engagement with oil companies. “This is a huge turnaround from the industry’s previous stance, which had been that no existing assets were likely to be stranded, that there may be risks in the future, but not in the here and now. That acknowledgment, that the risk is real and it’s here in the present, is a really big deal.”


Energy UK asks government to enable payment holiday scheme

UK energy companies are asking the government to support a £100m loan scheme that will enable businesses and households affected by the Covid-19 coronavirus pandemic to take a payment holiday.

As reported by the Financial Times, energy industry trade body Energy UK has allegedly consulted with the UK Government to set up the programme, as the number of people cancelling their direct debit plans increases.

An Energy UK spokesperson said: “We have been in contact with the Government, Ofgem and Citizens Advice on what actions, protections and practical steps suppliers can take to support customers during these challenging times. Suppliers will be doing all they can to identify customers in vulnerable circumstances and provide support where possible on a case-by-case basis.

“On behalf of the industry, we have been also having discussions with the Government to explore if any additional financial support could be required to help these customers over the coming months.”

The plan would be for the government to lend money to energy suppliers that will repay once customers resume their payment plans.

The UK Government had already put in place a set of financial measures to help the economy during the pandemic, unveiling on 17 March its plan to give out £330bn in loans to businesses.

As reported by the Financial Times, the Department for Business, Energy and Industrial Strategy said: “We have been clear we will do whatever it takes to get us through this pandemic and have put in place an unprecedented package of support for businesses, including £330bn of loans and guarantees and paying 80 per cent of the wages of furloughed workers.

“We continue to engage with the energy sector to understand how suppliers and their customers could be further supported.”

The energy sector has already set up contingency plans to help customers during the pandemic.

Energy UK chief executive Audrey Gallagher said: “The sector is very conscious of the potential consequences for customers confined to their homes for prolonged periods.

“In particular, customers in vulnerable circumstances and those on prepayment meters may need additional help and support with repayments or keeping meters topped up.”


Energy firms’ request for a bailout is rebuffed by ministers

Cash-strapped energy firms have been denied a state bailout amid concerns they could go bust if thousands of customers are unable to pay their bills.

Suppliers had sought a special taxpayer-backed rescue fund as British workers brace for economic hardship and businesses shut their doors – but the Government has refused to provide one and is instead directing them to a rescue loan scheme already on offer to other companies, emails show.

Last week, trade organisation Energy UK approached the Government to request its own loan scheme worth £100m a month which could be used to offer repayment holidays for struggling customers.

But energy suppliers have instead been told to rely on support already being made available more widely.

In an email to the energy suppliers, Dan Monzani, director of energy security at the Department for Business, Energy and Industrial Strategy (BEIS), said: “I would like to draw your attention to the business support measures announced by HM Treasury on March 17.

“We are aware that energy companies do not always think they are eligible when in fact you may be.”

The email then goes on to describe the range of support measures available to companies in the UK, including the Covid Corporate Finance Facility for the biggest firms and the Coronavirus Business Interruption Loan Scheme for smaller players.Small companies and the self-employed | Numbers to call

The Government has so far been reluctant to offer special assistance to individual industries, instead pointing to these £330bn lifelines.

But there is some concern among energy suppliers that vulnerable customers will not be able to pay for their gas and electricity in coming months if they are unable to return to work. The small business loan scheme has also faced criticism for being slow to deliver cash.

A number of suppliers have already seen some customers cancel direct debits, an early indication they are struggling to make payments.

A string of energy companies have large debts and virtually no safety net after several years of aggressively chasing new customers and charging ultra-low prices. 

Industry sources have said that some smaller, profitable energy suppliers are frustrated that large loss-making firms appear to be seeking ways to get a bailout without having to get their bank to approve a business plan. 

Doug Stewart, chief executive of provider Green Energy, said: “There should be no need for further intervention at present.

“The Covid-19 measures are not about supporting companies with poor business models.”Business Briefing Newsletter REFERRAL (Article)

Last week Energy UK requested that firms provide detailed information to support their claims that customers are falling behind. 

In a letter to the firms, BEIS thanked suppliers for providing evidence on potential risks. It appeared to leave open the possibility of further support by saying that the Government is still considering these cases.

One of the companies that originally approached Energy UK to discuss the bailout was Centrica, the owner of British Gas.

In a statement, the company said: “This is about supporting customers and our immediate focus is on supplying the country with the energy that will help it get through the coming months.

“This is not about propping up financially weak and unsustainable energy supply companies.”

A spokesperson for BEIS said that Government had put in place an “exceptional package of economic support for businesses, including extending the eligibility criteria for the Covid Business Interruption Loan Scheme which will allow more smaller energy businesses to qualify.”

“We continue to engage with the energy sector to understand how suppliers and their customers could be further supported,” they added.


Arbnco Partners with Centrica to Improve SME Energy Efficiency

The company is set to deploy a prototype of its SME energy efficiency digital platform in three locations across the UK.

Scottish building optimisation company, arbnco, has won a £641,000 contract for phase two of ‘Boosting Access for SMEs to Energy Efficiency’ (BASEE), the Government innovation competition.

The contract with the Department of Business, Energy and Industrial Strategy (BEIS), through its Energy Innovation Programme, will allow arbnco to develop a prototype of its Digital Energy Efficiency Platform (DEEP) to improve energy efficiency across the UK’s 5.9 million SMEs. Phase two of the project will involve arbnco deploying the prototype for pilots in the central belt of Scotland, the West Midlands and Bridgend, Wales.

Led by arbnco, the project brings together energy and services company Centrica, Energy Systems Catapult, Aston Business School, Durham County Council and sustainable finance company, Cyan Finance.

DEEP will simplify the process of engaging with energy efficiency by automatically optimising a business’ total energy consumption and the energy performance of its premises specifically.

The platform will use a range of data sources such as energy consumption and building energy performance, retrieved automatically or supplied by the SME, to generate a unique list of physical and behavioural energy efficiency recommendations together with costs, trusted suppliers and finance options.

Andrew Stewart, research and development manager at arbnco, said: “The first phase of the project focussed on the technical feasibility of the platform as well as, understanding of the obstacles that SMEs face when it comes to energy efficiency.

“A review of potential business models was conducted by Energy Systems Catapult during the first phase. Bringing Centrica on board for phase two will provide greater insight and access to SMEs as we look to roll the platform out nationwide.

“By providing SMEs with critical insight into their energy use and tailored retrofit recommendations, based on an assessment of the energy performance of their building and patterns in their energy consumption, we can help thousands of businesses become more energy efficient.”

Liam Burlinson, head of business energy efficiency at British Gas Business, said: “SMEs have a critical role to play as the UK strives to meet its net-zero targets, but they often don’t know where to start when it comes to improving energy efficiency.

“Centrica is committed to helping customers become more sustainable and we think arbnco’s platform can help tackle some of the fundamental barriers that exist for SMEs today – such as lack of time, money or internal expertise to make targeted, cost-effective changes.”

Phase two of the project began in February 2020 and will run for 14 months. Following completion in April 2021, the platform will be rolled out nationally.

arbnco has partnered with Energy Systems Catapult on the project, which is providing Business Model Innovation support to improve the functionality and usability of the DEEP prototype.

Rebecca Lane, business modelling analyst at Energy Systems Catapult, said: “Having worked with arbnco on phase one of the project, we are confident we have now identified a strong value proposition from both ends of the value chain.

“As the project moves into phase two, we will be working with arbnco and Centrica to pilot the prototype in three locations across the UK and develop the product ready for its national rollout in 2021.”


Council-backed energy firm working with outsourced telesales centres in South Africa

A COUNCIL-BACKED energy company has confirmed it works with six outsourced telesales contact centres in South Africa that have 90 staff allocated to its campaigns.

But Scottish firm Together Energy says it only has one of its own members of staff based in South Africa, with the other 129 located in Clydebank.

Warrington Borough Council is putting £18 million into the company, as well as providing a £4 million loan to it.

Together Energy finished bottom of the Which? energy provider table and has received many complaints from users.

It said it is looking to recruit around 25 members of staff in Warrington and that it recently attended a careers fair in the town to help achieve this aim.

But concerns have been raised from customers following adverts online for vacancies in a South Africa call centre for work on a Together Energy campaign.

However, the issue has sparked a response from the company.

A spokesman said: “We do not have any sites in South Africa.

“We had a customer service function in South Africa to help us with the Supplier of Last Resort volumes which has now been closed and the function moved back to Clydebank.

“We work with six outsourced telesales contact centres in South Africa who have around 90 staff allocated to campaigns for Together Energy including a small sales verification team.

“These companies also sell for many other UK energy suppliers including most of the ‘big six’ energy companies.

“The adverts are for these companies trying to recruit people to work on our campaign.

“They are not our adverts or our employees.

“Our one full-time employee in South Africa manages these relationships and the necessary compliance for these centres.”

The firm says it is not directly recruiting for any field sales agents in Clydebank or any telesales agents in South Africa.

There was also an advertisement online for a national fields associate role in Clydebank to sell Together Energy products.

The spokesman added: “We also work in the UK with two outsourced field sales companies, who sell our tariffs and again recruit for people to sell Together Energy products.

“They are not employed by us and the job referred to is for one of these companies not us.”


Lords Committees come together on the climate change challenge

tarting next week, five House of Lords committees will be examine some of the ways climate change will affect specific policy areas, and what action the Government is taking to prepare for COP26, the UN climate change conference the UK is hosting in November.

On 11, 12 and 18 March, five House of Lords committees will consider climate change from five different angles, exploring how it will affect specific policy areas and what the Government’s response should be. Following these evidence sessions, on 25 March members from each committee will come together to challenge the Government on what action it is taking and scrutinise preparations for COP26, the UN climate change conference the UK is hosting in November.

The dates and times of the sessions will be as follows:
• Wednesday 11 March, 11am: climate change and migration
• Wednesday 11 March, midday: international carbon markets
• Thursday 12 March, 10am: climate change and international development
• Thursday 12 March, 10.15am and 11.30am: state aid and meeting climate targets
• Wednesday 18 March, 10:15am: Mark Carney on green finance
• Wednesday 25 March, 3.30pm: Rt Hon Alok Sharma MP and President of COP 26, on climate change and COP26

Speaking ahead of the series of evidence sessions, Lord Teverson, Chair of the EU Energy and Environment Sub-Committee, said:
“Climate change is an emergency. The repeated serious flooding here in the UK is just one of the many ways global warming is already taking its toll. That’s why five House of Lords committees have uniquely come together to examine this emergency.
“These sessions will shed light on a number of those diverse climate change challenges that now confront us. Our follow up will be pressing ministers on how the Government intends to move forward. With COP26 only months away, clear and focused responses from minsters will be essential.”

All of these evidence sessions will be open to the public. They can also be followed live on parliamentlive.tv