Electricity customers to receive environmental data with bills

Householders are to be provided with data on the fuels used to generate electricity provided by their supplier. The move, required by an EU Directive, is intended to help consumers decide whether to switch suppliers - but the complexities of the energy business may make it difficult to exercise market power.

From the start of October, electricity suppliers are required to give information to their customers on their environmental footprint (ENDS Report 341, pp 33-34 ).

The information comprises a simple breakdown of the fuels used to generate the supply company's electricity, along with figures for the average amounts of CO2 and nuclear waste produced. The figures will be updated every year and relate to electricity supplied in the previous financial year.

Some researchers wanted the information to be presented on each customer's bill. However, the labelling will be much less prominent. Fuel mix data will be included in literature sent out with bills rather than on the bill itself. For CO2 emissions and nuclear waste, suppliers need only direct customers to information published elsewhere, such as on the company's website.

The information, and a comparison to the UK average, is intended to help customers decide whether to switch supplier. "If you're concerned about global warming and CO2 emissions, take a closer look at your next bill, it could make all the difference," said Energy Minister Malcolm Wicks.

But even in an active market like the UK, where half of domestic consumers have changed their electricity suppliers since 1999, it is far from clear that the information will allow consumers to affect the national fuel mix.

Customers could conceivably make a wholesale switch to companies with a high proportion of renewables. But this would be unlikely to outweigh the biggest market driver, the renewables obligation, which requires all suppliers to source an increasing proportion of electricity from renewable sources.

The obligation - at 4.9% this year - is likely to swamp any customer-driven market shift. And since suppliers can trade in renewables obligation certificates to meet their collective obligation, it makes little difference if green-minded consumers switch between them.

Electricity from different sources is indistinguishable, and suppliers trade power in large volumes depending on market and technical requirements. Customer preferences on fuel mix are likely to be only a tiny factor compared to existing market movements that simply switch different fuels to different buyers.

Some have suggested that labelling could lead to a switch away from nuclear power, as market research found that 40% of customers were strongly anti-nuclear.

However, the nuclear component of domestic supply is already fairly low. British Energy sells much of its output - over 40% in the fuel mix disclosure period - direct to large users connected to the transmission network. Sales to large users by a number of other generators also bypass the retail suppliers, although they are included also in the UK average fuel mix.

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