Every year we publish what we think is a compelling statistic – the amount of money each electricity company in the UK spends building new sources of green electricity. We express this number as £ per customer because we think that has most relevance for people. In effect it tells you how much from your electricity bill is spent by your power company building new green power sources.
In my opinion it’s a statistic that gets to the heart of the issues, cuts through the greenwash and spin of the Big Six and the small independents – it’s The Measure to me, of whether your deeds match your words.
This weekend we published the fifth annual League Table of UK electricity companies, ranked by this spending measure, and with it a five year average.
The five year average adds a new perspective. We can all have good and bad years and so one year in isolation needs to be viewed with a little caution or wider knowledge.
But five years is five years.
It makes interesting reading. The Big Six are averaging less than £30 per customer per year on new green build – the relevance of that is that the Renewables Obligation places an obligation on all power companies to increase by roughly 1% per year their proportion of green electricity – and that 1% should cost roughly £30 per customer.
So these guys that spend tens of millions on their TV adverts and the like to convince us all that they are really green, and who offer 100% green tariffs (often at a premium) to a few customers – are actually falling to meet their tiny legal minimum targets. That’s the big thing I see from the stats.
And the small indie sector is actually worse – Green Energy and Good Energy may call themselves Green and Good, but they spend nothing at all, make no contribution to new green sources of power.
The Observer picked the story up this weekend.
And Centrica ‘hit back’ apparently. Their defence..? That Ecotricity wasn’t taking into account their promises of what they might do in the future. Damn right we’re not.
Promises are adding hot air to the environment not taking it away… 🙂
The Big Six seek to deceive us all with their marketing. The number of windmills they have in their adverts are inversely proportional to the number they have in the real world. And the small guys are actually worse.
I know that some people criticise this measure (£ per customer), but I don’t think there’s a better way to measure things. My logic goes like this.
We can’t fight climate change or create energy independence for the UK unless we build new sources of green electricity. The UK has about 5% today and needs say 50% ASAP. Electricity companies must take responsibility for that, they supply the stuff. We all use it so we have responsibility too.
It’s little use to a consumer of electricity (looking to choose the right company to be with) to quote the vague promises of future spend. Or the total spending in one year, because companies vary in size.
How much gets spent on behalf of each customer or in effect from each bill is a bang on way to represent the change that you can bring with your electricity bill, by switching to company X ,Y or Z. It empowers and cuts through the crap.
It’s actually an equal measure for companies of all sizes. And it can also be used to measure performance against the minimum legal targets.
The Big Six whinge when we use it – but guess what, two of them use it themselves. Scottish Power recently claimed to spend more per customer than any other ‘major supplier’ and Powergen did the same a few years ago.
In both cases they exclude Ecotricity from their ‘claims’ – they like the £ per customer, as long as it’s only between the big six.
Funny that.
Cheers.
Hi Dale
Thanks for this – no surprises again. Although I see Good Energy have got planning permission for the Delabole Repowering now…
I read an article in Feb 09 Edition of De Spiegel (which I have tried to post a link to but can’t), which examined the relationship between renewable energy and the EU emissions trading scheme (ETS).
It argues that new renewable energy on the grid eg say in Germany, will have no effect on total carbon emissions in the EU, as it will have the effect of lowering the price of carbon. This will make it cheaper for other members eg say Poland to emit more carbon by coal burning as it will have become cheaper. It argues that unless equivalent carbon permits are removed (retired) for every new MW of renewable generation added to the grid, the net effect will be zero. This has been playing on my mind and I wondered what you thought……
Thanks for publishing this again Dale. I have very little in the way of loyalty to any company, but this table is really the only reason I’m not yet spending hours trawling through price comparison sites.
Don’t be modest about this information! You need to shout about this. I see what you’re driving at in this passage about companies who spend millions on convincing us their green instead of on being green. But on the flip side, if for every £1000 of advertising you manage to convert 10 people to green electricity and more importantly, to contribute to the building of sustainable infrastructure, maybe it’s worth it? … As long as your spending doesn’t dramatically upset the above tables of course.
I think it’s very sad though that we have to rely on Ecotricity to represent our needs in this way. Judging by the following article, we can’t even poke fun at the Americans or Chinese anymore!! ! .. It seems we are being left behind.
http://www.independent.co.uk/environment/climate-change/britain-fails-to-deliver-on-pledge-to-lead-world-to-green-recovery-1634773.html
Thank’s Dale
This is information which is really useful.
I would rather pay a bit extra for my power now to secure it in the future and will look at our own household spending in light of this very revealing infoamation
Dear Dale,
It was great going through the blog and seeing your commitment to environmental sustainability.
I am very committed to the issue of sustainability and my experience a wind-energy firm in India has led me all the way here to to pursue a degree in the MSc Sustainability. Would very much like to work for such a conscience – driven organization in the future.
Regards,
Kavita
Hi Dale,
Great stuff – BUT, I have a small business and spend £20k + a year on electric but ecotricity tell me you cant supply me because I have HH supply? I know other people in the same boat – what are you doing about it?
Perhaps you could have a micro-version of your merchant wind power scheme?
Rgds
Pete
Dale – Brilliant!
I’m not supprised Eco are top, other suppliers dont seem to have got the idea yet!
Just shows what Eco are doing works!
BIG 6 – TAKE NOTE – YOU ARE NOT DOING ENOUGH!
I am a customer of Ecoctricity, and I’m impressed with your work. But amount per customer? Wouldn’t it be more valuable to see how much overall each company spent? Could you offer those figures? It’s just that, the fewer the customers one has, the larger the figure is going to be…
Andrew, look at the second table, 6 paragraphs after the first table. Easy peasy.
My point-of-view is what does the company do with YOUR money? The bigger companies will have a bigger turnover and of course will spend (and have spent) more in total, but what they do with each individual customer’s money is more important. It means that if you go to a company higher up the table, more of YOUR money will be spent on building new sources of renewable energy. Doesn’t it?
Andrew
The total spend over 5 years is on the chart above
Derek
I have to say that these figures don’t really clear things up from my point of view. My annual ecotricity bill now runs at £1400 a year! Does this mean that my bill is £1000 above the average!!
As a customer living in a small, highly efficient economy 7 flat with few electrical appliances I find this all very alarming. Perhaps the neighbours have tapped into my supply?
Have I understood these figures correctly?
The average doesn’t deal well with the fact that only a relatively small portion of UK households heat with electricity, eg not having access to the gas main…
Rgds
Damon
Erm, Justin, these figures are the amount of money spent on building new renewable sources of energy, per customer, not the average bill. So your bill is not £1000 above the average, but £1000 above the amount spent on building renewable sources of energy on your behalf.
Thanks Jeffrey for your reply. I guess where I’m getting confused is that it states on Ecotricity’s home webpage “Because for every pound our customers spend on their Ecotricity bills, we spend a pound building new sources of green electricity.” Which leads me, perhaps incorrectly, to assume that £1400 will be spent on renewables.
I don’t think I’m naive enough to believe that money won’t go to admin and business overheads but my discrepancy is so big I find it alarming!
I have to also accept that my bill is the equivalent of gas and electric combined but I still feel a bit cheated.
Good point Justin. I may have seen that claim before, but I had forgotten about it. Hmmm, then something doesn’t add up. I think Ecotricity have extra income from selling ROCs and selling surplus electricity on the balancing market, but that will be offset by buying electricity on the balancing market when there is a deficit. But I don’t know the numbers, nor what bearing that would have on renewables spending.
Justin
Averages are very good for statistical analysis but fail when you try to apply them to individual examples. Don’t forget, there are three types of average, the mode, which is the most frequent value, the median, which is the numerical “middle”, and the mean, which is used here, which is the total value divided by the number of individual values.
This is a statistical representation and is not a reflection of a “typical” bill.
With respect to the basis for comparison, it goes without saying that one of the Big Six, with a customer base and turnover which are multiples of those of Ecotricity, can invest much more in sheer volume on building sources of renewable energy. What this table shows is each companies individual commitment to investing in those sources. If I have £10 and spend a pound, but you only have a pound and spend a pound, on building new sources of renewable energy, which one of us is investing more, proportionally?
I think it’s as important to remember that Ecotricity stands out in this respect (how much they invest proportionally in renewable energy), as how much of their customers’ money they invest. Although essentially they amount to the same thing.
Matt
Hi Matt. I absolutely agree with your analysis and that Ecotricity spends a much higher proportion of their funds than any other energy company. I also concur that Ecotricity has the best solution towards funneling money into renewables. I accept that all of my money will end up paying for renewable energy but, and I realise there are others with even larger bills, I fear I may be paying too much.
Obviously for the mean to be £401.49 there has to be people paying a lot less and a lot more (me) and yet I consider myself to be a low energy user. Yes, everything in my studio flat is electric but I’m careful with energy useage. Yes, I’m not a typical Ecotricity customer but £1000 above the mean?? I’m one guy with one clothes wash a week! Is this because I’m paying a premium for Economy 7 or are Ecotricity’s figures a little confusing?
Justin – your electricity consumption sounds huge. We live in a one bedroom flat (top floor victorian terrace) and spend about £160/year on electricity. We have gas heating (and spend about £300-£400/year on gas).
£1400 seems truly excessive for a studio flat, even with electric heating.. if I were you I would start reading your meter every week to see where it’s all going!!
Try http://readyourmeter.org/ and http://www.wattzon.com/
Dave
Hey Justin
Your best bet is to take a series of readings over a week and see how much you’re using. Are your bills estimated or to actual readings? Also if you are on Economy 7 do you have night storage/immersion heaters or the like? Economy 7 is only really worth while if you have. My understanding is that the majority of Economy 7 meters record off peak usage between 12 midnight and 7am so unless your heating your water etc over these times you’re losing out.
Matt
Matt/Justin
Whether or not Economy 7 is worth it, it is definitely not going to leave anyone £1000 worse off.
Justin, I think the very first thing you should do is check your meter readings against what your bills say. I hope you have some old readings somewhere, or I hope at some point in the past Ecotricity have had the correct meter reading.
If the meter readings are correct, make sure you haven’t got any heaters (or other energy-intensive device) permanently on.
Sorry I hadn’t thought about your electricity bill up to this point, but it is excessive. How many units do you use per year, and how much does each unit cost?
@ Justin.
Bear in mind the day rate on a E7 tarrif is huge compared to a standard tarrif.
give Eco a call with a meter reading, they can calculate to see if you are better off on a standard tarriff! unless the majority of your usage is at night, i’d say you probably are!
J
Hiya Justin,
Hmmm – that does seem a bit high for a 1 bed flat.
My annual bill is around £1100, but for a 3 bed terraced pre-fab at the top of a windy hill with 4 residents – we have no gas supply.
Using electric for heating makes a *big* difference – especially if you use it outside E7 times, and without storage heaters.
We try to use local wood in the multifuel stove for heating and this saves a lot of money in the winter.
Combined average gas/electric bill is around £1350 p.a. apparently. Here’s a recent discussion about average elec/gas prices on a different forum.
I would suggest contacting customer services to discuss your concerns and steps to reduce your bill – or perhaps I can get them to contact you?
Paul
Thank you all for your feed back. I’m fairly sure I have set all the timers up correctly to use the night rates but admit that there is some worrying issues with my bill. I will investigate further.
This appears to have been a very useful discussion.
For those that were curious about my large ecotricity bill, the fault lies firmly at my feet! It turns out that my storage heaters are two units in one, a convection heater (very expensive to run) and the actual storage heater. What I hadn’t realised was that the storage heater end was broken and most of my heating was actually from the convection heater!!
I have learnt a valuable lesson. Thanks to all who drew my attention to the problem.
Dear Dale
I am a bit bemused by your claim that for every £ a customer spends on their electricity bill you spend £ on wind farm investment.
This would mean that you spend you entire turnover on investing in new wind farms.
Surely you have to pay for the electricity that you would provide to me- not all your energy comes from your wholly owned wind farms. Even if you did then how do you cover your overheads or pay your staff- do you make any profit?
@ Fiona,
I’ve had a guess in my comment above. Ecotricity probably get some extra money from selling ROCs and selling surplus electricity on the balancing market, offset by buying electricity on the balancing market when there is a deficit. Also, perhaps the £ spent to £ invested applies to domestic customers, then the business customers give extra income.
But I’m guessing, Dale could probably give a better and more accurate picture.
By the way, when are the planning blogs and construction blogs in the “Our Wind Parks” section of the ecotricity website going to be updated? There are a few that say something like “the appeal will be on (date)”, and the date has been and gone and there is no further word. And there are a couple where no blog entry has been made since 2007! I know I should really get a life, but I do like to follow the progress of wind farms in planning/construction…
ROCs, is my guess.
Rgds
Damon
Hi Dale,
Keep up the good work! I became a domestic customer of Ecotricity as soon as it was possible and remain very happy with my choice.
Can I ask if Ecotricity has plans for smart metering and monitoring of domestic customers?
I’m in the planning stage of a low energy renovation of my house in Cambridge and it would be good if electrical loads which were not time critical could be switched on when a surplus of renewable energy was available. Perhaps something like The Demand for Wind Project (http://demandforwind.co.uk)?
The Super-Smart Metering technology under development by ISE, Intelligent Sustainable Energy (http://www.ise-oxford.com) sounds very interesting. I particularly like the simplicity of a single point connection to monitor usage rather than having to have specially equipped devices.
Hiya Justin – glad you got to the bottom of the issue – hopefully your usage will plummet now!
Jeffrey – thanks for the heads-up on the construction ‘blogs’ over on the Ecotricity site – I have been told that there should be some updated news appearing on those very soon.
Thanks Paul. Glad to hear it. I look forward especially to finding out the results of the North Dover appeal, what’s going on at Hendraburnick and at Stoke, and when building is going to start for Lotus, Alveston and Galsworthy. I can always put off getting a life for now… 🙂
Thanks Paul, let’s hope so. At least I rest assured that my money is going to a good cause.
Although like Jeffrey I would love to hear more about all the good work that is planned and is progressing. I think, like most Ecotricity customers, we’re concerned about both about the ecology and the economy of our electricity use. Otherwise we’d be with the big six!
I was very disappointed to hear that Ecotricity would not be building the Sports City Wind Park. We have a 184ft tall sculpture called the “B of the bang” very close this site (also precariously close to a main road) that is 165 tonnes of steel. This structure failed has several times and although fenced off and ear marked for removal still stands to this day. Considering all this I find it silly to refuse a 232ft turbine, saving over 3,500 tonnes of CO2, on the basis that some ice may slide off the blades.
Of course I’m sure this is a very real concern but I saw this particular wind farm as an international platform for the company and it’s wonderful work. Was there no work around?
Sorry for the rant Dale.
I think that the possibility of ice fallng off the blades would be a huge risk in any sort of public place – and a football stadium has huge numbers of people around at any one time – I think to build a turbine there would be crazy – firstly the risk of injury to anyone, and secondly the reputation of the company would be severely damaged if such an incident were to occur. There are plenty of big fields in the UK that are perfect for turbines :o)
I’m sure Ecotricity weren’t stalled by this… it’s only a matter of time until a company like Eco go international anyway!!
International….
now there’s an idea!
Dale
Are there any plans to start supplying Northern Ireland in the near future?
@ Justin and anyone else who wants to know
I’ve been googling the North Dover Wind farm and found some news here. Not good news for the wind farm unfortunately. Not good news for the council either.
Googling for Hendraburnick… No decision yet, gathering from what I found.
I have to say, there is an outspoken anti-wind lobby out there…
Hi Guys, sorry for the delay, think I can clear up the big question here.
The £/customer figures are simply the amount of money spent divided by total customers. The idea is that this shows the proportion of spend each supply company makes, which does tell you more IMO than just their total spend (because some are much bigger than others). It also allows a comparison to be made on the basis of how much of a typical electricity bill has been spent. That is relevant to consumers.
And that’s the second bit that might have confused a little here. Ecotricity’s figure for 08 was about £400 per customer spent on new renewables, the five year average figure is £450 per customer. We’re saying that this is roughly a typical electricity bill in the UK – and therefore we’re spending our customers entire bills, in effect, £ for £. Or put another way “for every pound you spend we spend a pound”.
I realise that some people spend more and some spend less. Comparing to a typical bill is just a handle, to give people a sense of scale. I think it’s a big story, the whole of a typical electricity bill being spent on new clean sources – each year for five years (and customer numbers quadrupled in that time BTW).
Then there’s the next bit – how on earth can we do that? Don’t we have overheads, sell ROCs, buy electricity etc etc. All correct – it’s an equivalent sum, not the actual money our customers pay with, because we do have to pay staff and for power and lots of other things and our eventual profit margin is actually pretty small – not 100%…!
This is how it works: When we finance a wind project it’s a bit like buying a house, you stump up a % of the capital cost and a bank stumps up the rest. And just like houses you could get mortgages for 90% of the cost if the project were strong enough (I say could, because the credit crunch has had an impact on that). Anyway, what that means is that we need say 10% of the cost of a windmill, to actually build one – the rest of the money comes from the bank. So we can leverage a small profit margin into a big spend on renewables. It’s easy enough.
All it takes is the will and the commitment to fight the planning system, day in and out. Other than that any power company can do it.
Pete, the HH market (Half Hourly) is quite difficult for us to operate in, it’s a high volume low margin thing, and we’re currently unable to operate there in any major way – that will change over time as we grow. And a mini Merchant scheme for this sector is a great idea, if our Urbine works we’ll scale it up to 5 and 10kW for just this purpose. We’re doing the most we can as fast as we can, just can’t do it all straight away.
Justin, glad to see you got to the bottom of your consumption issue – your bills should shrink somewhat from here…. 🙂
Cheers.
Hi again, just a quick word from me on the Sport City project (Man City ground).
We pulled out of the project (even though we had planning consent) because we couldn’t be confident that there wouldn’t be a problem or an accident in fact that might result in injury. It’s a peculiar site from a wind H&S point of view, much of the week it’s empty enough but match days it’s stacked with folk.
We weren’t able to control the area around and under the turbine either and this would have been our normal way to control/reduce risks to an acceptable level. That left us looking at something we couldn’t be sure enough of.
From our point of view the PR from such a machine would have been awesome, and it’s exposure to people (and vice versa) well worthwhile – but we felt the risk of an accident and the subsequent damage that would do to the reputations of wind energy, Ecotricity and the Club (man City) – on balance just wasn’t worth taking.
Hard decision to come to I can assure you, I really wanted to build this one. If we could have controlled the ground under the turbine on icy days we’d have been on the right side of the line. But that wasn’t possible.
Cheers.