Suppliers of Last Resort: Businesses affected by the energy crisis

If you’ve kept up with the energy sector at all these past few months, you will be aware of the crisis in the market price of gas, causing over twenty energy suppliers to cease trading or go into administration within 2021. The most recent of which was Bulb, an energy supplier who were responsible for over 1.7 million customers.

In the process of an energy supplier ceasing to trade, the UK’s energy regulator will appoint a supplier of last resort (SoLR), most of these suppliers are often larger energy suppliers with the ability to take on large amounts of clients. Any credit one will have had with their previous energy supplier will be transferred over and supply of electricity and gas will continue regardless of the changeover.

Often new customers will be set up on a temporary or short-term flexible contract which will see an increase in overall price of energy during this rise in the market. For domestic customer, the instated energy price cap will keep energy costs to a limit until April of 2022 when reviewed by Ofgem.

However, for businesses an energy price cap is not ensured and the rates a SoLR charge can be incredibly, doubling initial energy suppliers’ costs to combat the rising market gas prices. Furthermore, increased energy price contracts are inevitable for businesses in need to renew an energy contract with the same energy supplier.

Although all businesses finding themselves in a new energy contract within this quarter will be paying more on energy rates than previously, Intelligent will review your utility bill and utilising our services, find the ideal energy contract for your current business needs. In some cases, SoLR can be the best offer in the energy market, however we can find fixed rate contracts that will secure a consistent utility bill during this unstable time in flexible energy rates,

Get in contact today for a full review.

Pass-through Rates: Saving Money on your Business Energy Bills

One of the main ways Intelligent can save your business money on utility contracts is by performing a full review of your bills and finding ways you can reduce your outgoings through fixed energy or pass-through rates.

An energy bill is formulated by two payments; an energy payment based on your gas and/ or electricity usage and additional variable pass-through rates set by third parties; these pass-through rates often make up between 40 to 60% of your entire energy bill.

Although your energy cost is a projection of your yearly energy usage for a supplier to buy wholesale at the beginning of the year, pass through rates are variable depending on your meter type, location, as well as type of business. These pass-through rates often rise in contrast to a fixed energy tariff, and contribute toward the infrastructure of energy, covering the transportation of energy, upkeep of National Grid and its ability to maintain the supply and demand of electricity balanced constantly. As well as climate change and low carbon initiative programs.

These pass-through rates are not produced or controlled by a supplier, rather they are subject to decisions by the Government, energy regulator Ofgem and any third parties involved; metre reading costs. The pass-through rates can fluctuate depending on Government legislation, for example COP26 pledges may raise the climate action rates.

Due to pass through rates not depending on energy usage, initial pricing can often neglect the full charges of a bill, leaving business owners surprised at the full energy outgoing. At Intelligent we make sure our partners utility bills are entirely transparent in order to find an ideal contract for our partners business energy usage.

Furthermore, VAT charges are included in pass through rates, which are automatically implemented to 20% on an energy bill, however, some kinds of businesses are VAT exempt and therefore can reduce the total outgoings on an energy bill.

For a full review of your business’ energy utility bills, get in contact today and we can find out where to save your business money.

The Pledges of COP26: Week Two

Today marks the last day of the COP26 climate conference summit, in which hundreds of nations came together to listen to seminars about the impact of global warming, climate change and the carbon footprints of the energy sector. Highlighted in last week’s blog post (linked here for further reading https://intelligentgas.co.uk/the-pledges-of-cop26-week-one/), the first week of COP26 showcased a positive approach towards the future of the climate, with several important pledges signed by hundreds of nations.

However, as the second week of the conference proceeded, the bright outlook towards the fight against climate change appeared to have dampened. Nations reversed their pledges to certain commitments (or example Indonesia pulled out of the deforestation treaty), the view from environmentalist saw nations not putting enough effort in and a report from the Climate Action Tracker projected that with the current implements against climate change, the global climate would still rise by 2.4C, a detrimental increase in temperature which would see irreversible damage to the planet.

Therefore, on the final day of COP26, a representative from each nation must sign an agreement proposing the way in they will implement change to win this battle against climate change. A second draft of the document was revealed this morning after the initial draft released on Wednesday was critiqued for its lack of urgency towards tackling carbon emissions. The main point within the agreement highlights the usage of fossil fuels, most prevalent the use of coal, as well as how developed countries who produce a majority of the harmful emissions will financially assist developing nations which are most affected by climate change. There are reports that there is a lot of push back from richer nations to assist those without the same opportunity, however the conference will not end until the document has been unanimously agreed upon, with negotiations pushing the summits end later and later.

Regardless, the summit has seen some important pledges this week. The UK government proposed a pledge that would see all new heavy goods vehicles to be zero-emission by 2040. Alongside the commitment to stop production of domestic internal combustion vehicles by 2030, meaning that by 2040 all new vehicles produced in Britain will be completely electric. Additionally, the government signed a pledge committing all UK health services to achieve net zero emissions through a new global health program. Alongside the UK, 47 other nations pledged to develop low carbon and climate resilient health systems.

Finally, the last big promise from the UK government came in the form of a new £290 million funding scheme to reverse the impact of climate change in developing nations. The focus of the funds will be going to Asian and Pacific nations to invest in climate action, conservation, and low carbon development. With the summit situating in Glasgow, the UK have been at the forefront of the climate actions and with the pledges signed over the past two weeks It appears the government have a foot in the right direction, yet it will be interesting to see if it is enough to maintain a safe global climate temperature.

It is of note to mention that there are some commitments the UK have not entirely backed, this includes a coalition led by Denmark and Costa Rica which has pledged to halt the licensing of oil and gas production as a step to phase out fossil fuels. Ten nations have vowed to the ‘Beyond Oil and Gas Alliance’, including Ireland and Wales, yet the UK has not backed this proposal as a whole nation.

COP26 has been a fascinating event bringing the conversation of climate change to the forefront of both the popular conscious, as well as the leaders and representatives of the nations which are able to effectively alter the course of the future. It will be interesting to witness how the pledges made at the summit will be adhered to after the event, as well as what the final confirmed agreement will entail.

The Pledges of COP26: Week One

The start of this week marked the beginning of the COP26 climate summit, with world leaders and representatives from 190 nations meeting in Glasgow to discuss and commit to pledges which will ensure a safe and sustainable future to our planet.

Thus far, three main pledges have proposed actions against climate change and highlight the important news to come out among the constant discussions and discourse from world leaders and representatives. These three main pledges each propose to reduce the level of deforestation, emissions of methane and coal power.

Signed by one-hundred and ten nations, the first pledge aims to end deforestation by 2030, backed by £14 billion in public and private funds. Included in the signatories is Brazil, who’s as a nation own vast portions of the Amazon Rainforest and are a main power behind mass deforestation. In hope, the increase of trees and dense foliage would absorb and reduce levels of CO2 and accelerate aims towards a cleaner atmosphere.

On Tuesday, over one-hundred countries signed a pledge committing to cut emissions of methane, as reports state that the greenhouse gas was responsible for a third of climate warming. This pledge has aimed to reduce methane emissions 30% by 2030, as reducing methane is one of the most effective things to target that could create significant reduction to near term effects of global warming.

Finally, the pledge to reduce reliance on coal power was signed by twenty-three nations on Thursday, as a commitment to phase the non-renewable element and transition to more sustainable sources. Included within this pledge are five nations which rank within the twenty highest ranking coal using counties, most notably South Korea and Indonesia who rank fifth and seventh.

It will be interesting to see what comes from the second week of the climate summit as some leaders have started heading back to their respective countries.

COP26 Summity and Assisting the Future of Green Energy

This week’s news has focused on the government’s renewable plans ahead of Glasgow’s COP26 summit this weekend. These plans focus on an increase in EV vehicles, a net zero electric grid strategy and investment into a nuclear plant which could provide 14% of Britain’s energy. Additionally, the energy market price has slightly decreased in the last few days which is hopefully an early sign on a more manageable winter for energy pricing while we still heavily rely on fossil fuels. Regardless, with the recent documentation from the government and the noise surrounding the COP26 summit, the future of energy is green.

COP26

With the COP26 summit starting within two days, the news around the next few weeks will focus on the discourse and precedents coming out of the event. The COP (conference of the parties) will be the 26th time the nations have met to discuss the climate, however, this year’s summit appears to be the most important since 2015’s Paris agreement. With COP26 being hosted in Glasgow, the UK is at the forefront of the event, especially with the recent release of the Net Zero strategy plan and the autumn budget, in which the government showcased a clearer understanding on how Britain will fulfil the proposal of a Net Zero by 2050. The release of these documents comes just before COP26 with immense pressure to issue long term resolutions for the current energy crisis facing the UK, caused by a reliance on fossil fuels and a dramatic increase in the gas market price. Nonetheless, the aim of net zero appears to be a short fall in the governments plan, with reports that an infrastructure to support the projection of EV vehicles will not meet the UKs demands, these are the issues that will be raised and hopefully solved at the COP26 conferences.

The main goals of this COP will focus on the nation’s adherence to the Paris agreement, a legally binding treaty by all nations to tackle climate change, as well as operating within the 1.5-degree climate increase before net zero. With the Earth’s temperature rising, any increase over 1.5 degrees could prove immensely devastating and unsolvable, therefore any carbon production in nations before a transition to renewable energy cannot proceed an increase to the Earth’s climate more than 1.5 degrees. Although not every nation appears to be attending COP26, each contributing nation will be challenged on their plan to adhere to the Paris agreement and how together, as one, we can assist each other in a cause that defies borders, the future of this planet.

Reducing your carbon footprint

With Net Zero and COP26 being at the forefront of the news, many people are wondering how they can assist in this transition to a renewable future. If you’re a consumer of domestic energy, it can be incredibly hard to make a significant difference compared to a high energy consuming energy industry, however if a lot of consumers reduced energy usage in the home you can assist saving the Earth and save a few pounds in the process, especially over the winter months. A lot of home energy saving is self-explanatory, yet those in the energy sector suggest reducing the escape of heat in rooms is the best measure to using less energy. Keeping doors closed, blocking any potential draughts at the bottom of doors or in windows, building shelves above radiators to reduce the heat rising and replacing bulbs with LED efficient bulbs are the most cost-effective resolutions. For those looking into a larger impact on the environment, there are now options to invest in a decarbonising heat pump to replace your traditional gas boiler. Although quite expensive, government backed subsidies can assist if you’re interested in installing in a heat pump for your home.

If you are a UK business interested in changing your supplier to renewable energy, get in contact today and we can find you a utility plan for a brighter future.

We will continue reporting on the discourse coming out of COP26 over the next few weeks on our LinkedIn and Twitter pages with daily energy updates.