Verdantix Says The UK's Biggest Power Utilities Are Finally Starting To Deliver On Sustainable Business Visions
London, UK. March 9, 2011. Centrica, EDF Energy, E.ON Energy and RWE npower are the power utilities best positioned to provide UK businesses with sustainable energy supply and services, according to a new report from independent analyst firm Verdantix. The in-depth study compares 13 power utilities operating in the UK, ranging in revenue size from £10 million to £70 billion, on 37 assessment criteria. Power retailers were assessed on their provision of green electricity contracts, sustainable gas contracts, on-site renewable energy and heat generation, energy management advice and implementation and carbon and climate change legislation advice. They were also assessed on their corporate sustainability and low carbon energy strategies. Firms included in the study are Centrica, E.ON Energy, Ecotricity, EDF Energy, Gazprom Marketing and Trading Retail, GDF Suez UK, Good Energy, Haven Power, RWE npower, Scottish and Southern Energy, Scottish Power, SmartestEnergy and Total Gas and Power.
“The fuel mix of power utilities in the UK gets a lot of attention from environmental commentators, but for Heads of Energy or Chief Sustainability Officers responsible for sustainability strategy it’s just one part of the picture” commented Vanessa O’Connell, Verdantix analyst and author of the report. “Seventy three per cent of our customer panel said that carbon and energy management was the major sustainability issue for their firm. Rising energy prices and the Carbon Reduction Commitment are driving firms to increase spending on energy efficiency, energy management technology and climate change advisory services. Meanwhile, feed-in-tariffs incentivise increased spend on renewable energy installation. Over the last five years some of the largest power utilities in the UK have invested heavily in service development and are positioned to meet new demands for sustainability and energy services.”
The Verdantix report, Green Quadrant® Sustainable Power Utilities, is based on in-depth interviews with an independent panel of 15 senior decision-makers across 8 industries with responsibility for selecting power utilities. Verdantix also interviewed practice leaders from participating utilities firms. Key findings of the study:
• Demand for energy management services is transforming utility business models. Leading power utilities are investing in a fundamentally different, integrated services business model and all have energy services teams. Centrica launched a separate business division, Energy 360, in 2009, which has grown to 500 employees through four energy services acquisitions in 2010. E.ON’s Sustainable Energy business team has grown forty-fold since 2007.
• Centrica, EDF, E.ON and RWE npower lead the market for sustainable power utilities. These firms combine capabilities in at least five of the six service lines analysed with robust internal sustainability strategies. The head of RWE npower’s sustainability programme reports directly to the CEO, whilst EDF Energy has committed to reduce the intensity of CO2 emissions from electricity production by 60% by 2020 against a 2006 baseline. Leading firms are also characterised by strategic investment in sustainable innovation. E.ON is piloting wave, tidal and sustainable gas projects and Centrica has announced an accelerated smart meter roll-out plan.
• Five specialists with innovative business models focus on low-carbon energy supply. Good Energy, GDF Suez UK, Ecotricity, Scottish Power and SmartestEnergy have above average compliance with the Renewables Obligation and innovative green electricity contracting. Good Energy supplies 100% renewable energy and Ecotricity re-invests all of its profits in wind and solar firms. Smartest Energy is the largest purchaser of independently generated renewable and low carbon energy and has developed power purchase agreements which give buyers detailed visibility over their energy supply.
“There is a clear opportunity for utilities to grow market share in a range of energy management and climate change services” commented Rodolphe D’Arjuzon, Director at Verdantix. “But although leading utilities have an impressive suite of services, customers traditionally turn to specialist energy consultants such as Nifes and Environ for help with energy efficiency. Many still do not trust utilities firms to help them reduce their energy consumption. To compete against energy consultants, utilities face a tough transition: they must radically change their traditional low touch engagement model with customers to overcome distrust in the market.”
The report, Green Quadrant® Sustainable Power Utilities is available to download by Verdantix clients at: www.verdantix.com.
About Verdantix
Verdantix is the fastest-growing, independent, analyst research firm focused on sustainable business strategies and market opportunities. For more information visit: www.verdantix.com.
Press Contact
Elinor Newman-Beckett, press@verdantix.com
+44(0)203 371 6792
Wednesday, 09 March 2011