Gas prices at the UK NBP for both prompt and curve were softer Tuesday, as more supplies relieved the within-day market and boosted confidence that gas would meet demand in October. The curve also came down in price, which was a reflection of the weak crude market, traders said. Within-day was at 69.25 p/th at midday, which is about 4 p/th lower than the day-ahead close on Monday. Traders said more gas was coming to the UK from Norway, which was part of a 10 million cubic meters supply boost earlier in the morning. This led to confidence that October would be well-supplied relative to demand, and October was assessed at 69.80 p/th at midday, which is 2.4 p/th lower than Monday’s close. The Q1 09 contract was down 3 p/th on the day to 95.75 p/th, a mixture of weaker oil sentiment and confidence that gas will arrive, and next summer was
also off 3 p/th, at 73.75 p/th. Next winter was down 2 p/th. Although crude was rising Tuesday, it had not recovered Monday’s losses.

Energylinx are delighted to receive confirmation from energywatch that we have been accredited for the third time. Energylinx was one of the founder members of energywatch and has held accreditation to the Code since 2003. With the responsibilities of energywatch about to transfer to Consumer Focus in a few days time Energylinx looks forward to the continuation of the Code itself. The full press release from energywatch can be viewed below. Consumers can trust accredited energy price comparison sites. With millions of consumers seeking expert help on switching supplier in a bid to cut their energy bills energywatch is pleased to announce that all the online comparison services accredited by the energywatch Confidence Code have passed a stringent audit of their services. The providers are subject to regular scrutiny to ensure the information they provide to consumers is accurate and comprehensive, and once a year they are independently audited to make sure they are continuing to meet the high standards set by the Confidence Code. Tim Whittle, energywatch Code Manager, said: energywatch has made the Confidence Code even more robust this year and the price comparison Service Providers have shown how much they value the accreditation by raising their game to meet the challenges we set them. Consumers using an accredited site can be 100% confident that they are seeing all tariffs and that the results are completely unbiased. All of the providers who reapplied for Confidence Code accreditation have been successful. I am also hopeful that there will soon be some new names among the list of accredited providers: several have applied and will soon be going through the compliance audit process. In a world where consumers are bombarded with online advice and comparison type information the energywatch Confidence Code is unique. No other industry has its internet comparison providers so tightly scrutinised by a consumer watchdog operated accreditation scheme that is so robust. The scheme will continue under the new consumer Advocacy body, Consumer Focus, which is due to launch on 1st October.

energywatch believes that other industries and markets would do well to develop accreditation schemes that force providers to live up to high standards. Tim Whittle continued: Consumers can go online to compare financial services providers, car, home and travel insurance deals, and everything from loan deals to life assurance but only in energy can consumers take comfort from the protection offered by an impartial and independently audited accreditation scheme. To protect consumers, regulatory bodies and watchdogs should examine the Confidence Code model and see how it could be applied to their sectors. ends

Price Comparison Service Providers comment:

Gareth Kloet of Confused.com, said We are delighted to have once again successfully passed the energywatch Confidence Code accreditation and consider this endorsement as being synonymous with the way in which we operate. Providing customers with easy to understand, transparent information that allows them to make an informed decision is central to our philosophy. energywatch has done a fantastic job since its establishment in 2000 and has been an extremely effective catalyst for change in policy within the industry which in turn has led to beneficial changes for customers. There are still significant challenges ahead in what is still a very confusing industry for the majority and we look forward to working with and supporting Consumer focus in the achievement of its aims.

Mark Todd Co-Founder & Marketing Director, Fundraising Innovations Ltd, said energyhelpline is delighted to have once again been accredited by energywatch as an accurate and impartial service for customers. We have been working with energywatch for the last 7 years and believe that their work has helped millions of consumers in the UK. energywatch has led from the front in the fight for consumer justice, providing practical help for consumers, and even taking on OFGEM and the Government. It would appear to us that they have been punished for being too vocal, too much on the customers side! Hence the decision to effectively close them down. It is sad to see the end of energywatch as an entity for consumers and hope that Consumer Focus will provide real practical help to consumers as well as making good policy decisions. energyhelpline shall work with them with this aim – to benefit the pockets of the individual consumer in this turbulent financial time.

Ken Geddes of Energylinx, said As founder members and strong advocates of the Confidence Code as a visible signal to consumers that they are using a transparent and professional service are pleased not only with the continued inclusion of Energylinx on the list of Service Providers, but on the fact that all those who were subject to full audit and reassessment were successful, which should be seen as a mark of the integrity of those working in the sector. Energylinx looks forward to the launch of Consumer Focus and hopes that this will bring additional transparency to the UK energy markets.

Mark Read Managing Director of Home Advisory Service, said We are proud to have been, once again accredited by energywatch., said We look forward to working with Consumer Focus and hope that the benefits of using fully accredited comparison sites will be championed to the full.

Scott Byrom Utilities Manager at Moneysupermarket.com, said As the UK’s leading price comparison site, moneysupermarket.com is delighted to maintain its 100 per cent commitment to the energywatch Confidence Code. The Code plays an integral part in reassuring consumers they will find the best possible price for their energy through an accredited comparison sites. The development of the Code, and the manner in which it operates, provides consumers with much needed transparency in what can be a complex market. By doing so, the Code will continue to install trust in accredited sites and ultimately protect the consumer. Moneysupermarket.com looks forward to working with Energywatch, and the new Customer Focus, to ensure the Code reflects the energy market in the best possible way.

Richard George Managing Director of SaveOnYourBills, said SaveOnYourBills.co.uk are delighted to have passed the energywatch Audit having worked with the UK energy regulators for almost 10 years in the UK energy switching market. Whilst sad to see the good Energywatch brand be lost after all the hard work they have done, SaveOnYourBills.co.uk welcomes the New Consumer Focus and hope they can take on the challenge of helping the UK consumer in the UK energy markets.

Sean Gardner, director at MoneyExpert.com, said: We are pleased that Simply Switch has won accreditation to the Confidence Code.

Alison Morrison Head of Non-Subscription Marketing at Which? Said We are delighted that Switch with Which? has been accredited by energywatch for the third year in a row. It is essential that consumers can identify energy switching sites that adhere to the high standards set by this code of confidence.

Joe Malinowski, founder of TheEnergyShop.com, said: Everyone at TheEnergyShop.com is very pleased to have been accredited with the new energywatch confidence code. Our company has worked hard to offer consumers a service which is easy-to-use and shows the very best deal. It is now more important than ever that people have confidence in their price comparison service; not just ones that are energywatch accredited but are also financially robust. Faced with record energy bills TheEnergyShop.com is on hand to help consumers not only get a better deal, but in the safe knowledge that we will be around to follow through.

Richard Eden of Ukpower.co.uk, said We would like to acknowledge the excellent work carried out by energywatch in pursuit of reliable and impartial comparison services for domestic energy customers. Ukpower.co.uk was one of the first energy comparison services to be approved by Ofgem and energywatch and has consistently followed guidelines to ensure first class services for our customers. Now, Ukpower.co.uk looks forward to continuing this good work with Consumer Focus with the same objectives to assist customers find the best deals available for their gas end electricity requirements.

Florian Ritzmann of Xelector.com, said Unravelit.com are pleased to see the Confidence Code continue under the leadership of Consumer Focus. There are dark days ahead, and a strong Code to protect consumers can only help.

Nick White, Director of Products at uSwitch.com, said This sends out a very clear message that the information and service we provide is accurate, comprehensive and completely unbiased. In a time of rising prices and financial uncertainty, consumers who want to cut the cost of household bills can use our service with absolute confidence that they are doing the right thing.
Notes to Editors

The operation of the Confidence Code will pass to Consumer Focus after energywatch is abolished on 30 September 2008. energywatch was established under the Utilities Act 2000 and will be abolished under the Consumers, Estate Agents and Redress Act 2007.

About the energywatch Confidence Code: It is a voluntary Code of Practice and not a mandatory one enforced by the regulators. Service Providers have to agree to an annual compliance audit carried out by an independent auditor and pay the costs associated with it. Accreditation is not just a Kitemark or stamp of approval, it’s a requirement that Service Providers comply with the Code at all times and they are tested regularly for continual compliance. The Code and Code Guidance can quickly be updated to reflect changes in the energy market. Energy suppliers insist that new price comparison Service Providers are accredited to the Code, before they will agree to enter into commercial relationships with them. The sites currently accredited to the Code represent all the major players in the energy price comparison market. They account for more than 90% of all online switches performed in the energy market. The Confidence Code protects Consumers, other Service Providers and Energy suppliers. For consumers it ensures information is impartial, accurate and up to date. Whilst for Service Providers it ensures that any anti-competitive behaviour is minimised and it gives them equal prominence in the comparison market. For energy suppliers, it ensures that their products are listed impartially on the Service Providers websites, regardless of their commercial agreements.

Homes could be plunged into darkness this winter as the nation faces the shocking prospect of power cuts. The warning, following the release of grim industry figures yesterday, will dredge up memories of the last electricity crisis in 1974. Then, households had to manage with candles, factories were put on short-time and TV broadcasts ended at 10.30pm. The figures from the National Grid suggest that the country could be crippled by energy shortages when the colder weather bites because there is so little spare capacity. The loss of only one of our 38 biggest power stations at times of high demand could lead to breaks in supply, bringing factories to a halt and leaving many homes in darkness. ‘We should be very worried – this is reaching national crisis proportions but the response is piecemeal and inadequate,’ said the industry watchdog. In addition, the rising cost of power could also prompt further ’savage’ hikes in families’ energy bills, analysts claimed.

The National Grid figures sent the price of wholesale electricity skyrocketing to record levels yesterday. It also focused attention on the Government’s faltering energy policy and evoked memories of the grim period between January and March 1974 when millions endured regular blackouts. Last night Allan Asher, chief executive of Energywatch, warned of a national crisis. On prices, he added: ‘Consumers are being bled white by the generators and the retailers. The outlook is for further price shocks for consumers.’
Eggborough Power Station, a coal fired plant near Selby: Restrictions on coal-burning could also hamper capacity. The National Grid figures detail exactly how much power it expects to have in reserve this winter above its minimum safety target. It said that surplus supplies will be as little as 826megawatts, or 1.5 per cent of total consumption. Only last week, it estimated that the available back up would be 1,373 megawatts.

Such a dramatic reduction in the figure led experts to question whether the country has enough in reserve. The problem, say experts, is that Britain’s ageing and unreliable power generating infrastructure urgently needs billions of pounds of investment. In particular, British Energy has seen a spate of nuclear power plant closures because it is struggling to keep the sites operating. Coal-fired stations are being forced to limit their output because of pollution controls on the amount of carbon dioxide they pump out. This means utilities are often turning to inefficient, oil-fired power stations to make up shortfalls. Britain’s increasing reliance on wind power will also not help, given that output fluctuates wildly depending on the weather. The alarming outlook prompted dramatic moves in wholesale power prices on the financial markets yesterday. The cost of electricity soared to a record £105.25 a megawatt-hour, more than double the £45.90 level for winter a year ago. In May, half a million customers were hit by power cuts after a series of unexpected problems at power stations forced the National Grid to conserve supplies.

Experts have repeatedly warned that Britain will face dangerous shortfalls in its generation capacity by 2015. Even if supplies were imported from France, the likelihood is that they would not make up the shortfall. Yesterday’s moves in power markets reflect fears among traders that we face a power crisis far sooner than that. A spokesman for the National Grid said the outlook was published to encourage power firms to adjust their programme of maintenance over the coming months and he tried to play down the shortage fears. He said: ‘There are a few weeks where because of the pattern of generation outages it (the surplus) has gone down close to our target. But it still above our target.

The U.K., Europe’s second-largest economy, risks power shortages and a jump in utility bills this winter because of repairs to aging nuclear reactors and pollution rules that limit coal burning. The nation’s electric grid cut forecasts for spare capacity today to a level where the loss of any one of its 38 largest power stations at a time of peak demand risks forcing factories to shut down to save energy, data from London-based network manager National Grid Plc show. The last time that happened, in May, wholesale electricity costs jumped 13 percent in a day.

U.K. power prices for this winter rose to a record today and are more than double a year ago after British Energy Group Plc closed two of its eight nuclear power stations and extended maintenance at others, while curbs on sulfur dioxide emissions forced coal-fed plants to cut operating hours. One of the reasons the government supported Electricite de France SA’s 12.5 billion-pound ($23 billion) agreement yesterday to buy British Energy was a pledge to build the first atomic plants since 1995.

National Grid said today that surplus power supplies this winter will be as little as 826 megawatts, or 1.5 percent of consumption, cutting the predicted minimum from 1,373 megawatts last week. The amount represents what’s left after the grid meets peak demand and maintains a margin to provide reliable service. The estimates leave little flexibility. The grid’s forecast is based on information provided by the country’s electricity generators. Peak demand for the week of Nov. 10 is forecast at 56,500 megawatts.

November baseload power, the contract traded via energy brokers for around-the-clock deliveries, rose 8.3 percent to a record 124 pounds a megawatt hour today. Winter baseload was at a record 105.25 pounds a megawatt-hour, more than double the 45.90 pounds a megawatt-hour price for winter a year ago.

The forecast indicates that for now there’s enough generation available, said Stewart Larque, a Warwick, England- based spokesman for National Grid, before the most recent update to the forecast.

“The reason why it is published is so that people can make the right decisions,” he said. “If the figures were negative, that’s when it becomes a signal to the market to make more capacity available.”

Electricity can’t be stored, so production needs to continually meet demand. The power grid has spare plants that only run at times when demand and prices are at their highest. Mothballed generators can return to service if the cushion threatens to disappear, Larque said. Supplies may push prices to “the sort of level that forces industrial demand off the system,” said Jeremy Nicholson, the director of the Energy Intensive Users Group, whose members include the steel and glass industries. “We are heading in that direction.”

Day-ahead baseload power prices this month have reached 124.50 pounds a megawatt hour, the highest since March 2006, and more than three times costs the same time last year. The next- day contract traded at 99 pounds a megawatt hour today.

Sizewell Shutdowns

National Grid said on May 27, the day when the shutdown of British Energy’s 1,200-megawatt Sizewell-B power plant caused supply interruptions in parts of England, that steps to reduce demand were imminent because of insufficient spare supplies. It was the first such notice since 2006. This year it has warned five times that spare supplies aren’t adequate in addition to the demand-reduction notice.

Scottish & Southern Energy Plc and International Power Plc are upgrading plants to comply with restrictions on gas emissions. They may resume normal output in the coming months. “Until that work has been completed, presumably there’s some risk,” Nicholson said.

British Energy plans to start four reactors in the fourth quarter that have been closed for a year because of corroded wires.

Those plants may be needed. Winter temperatures may be colder than normal, according to Jim Dales, senior forecaster at British Weather Services, which sells forecasts to businesses including energy companies.

November and December may be milder, while January and February may “deliver significantly below-average temperatures,” he said.

Morrisons is opening a superstore that monitors how much customers breathe, to save electricity. The store in Kidderminster, Worcs, is fitted with carbon dioxide sensors that set off cold air fans when it is full of shoppers. At quiet times, the fans switch off, saving energy. A Morrisons spokesman said: “It’ll ensure we use the right amount of energy. That’s good for the environment, so it’s a win-win.” The shop, opening Monday, also has solar panels and collects rain for its toilets.

Severn Trent Plc, the U.K.’s second- biggest water utility, said performance in the six months through September is in line with company forecasts as it continues to benefit from higher prices allowed by the industry regulator.

Severn Trent is seeking to keep annual operating costs 3 percent below the regulator’s target through the next two years, the Birmingham, England-based company said today in a statement. Commodity and chemical prices, which affect such costs, remain volatile, it said.

The utility, which supplies water to more than 8 million people, has over the past few months agreed to pay fines to resolve regulatory issues encountered under previous management. U.K. water companies’ sales are rising as industry watchdog Ofwat allows customer-price increases to fund investments.

Revenue in the year through March climbed 4.9 percent to 1.48 billion pounds ($2.75 billion), Severn Trent said in June. Ofwat has allowed the second-biggest British water company after United Utilities Group Plc to raise prices an average 4.5 percent a year through 2010.

Severn Trent today said infrastructure spending for the six months to Sept. 30 is expected to be about 60 million pounds, about 45 percent of total net expenditure for the year. Net debt, excluding adjustments, will probably be about 3.5 billion pounds at the half-year interval, it said.

The company last month said it wouldn’t appeal a record 35.8 million-pound fine handed out by Ofwat for providing false data and poor customer service between 2005 and 2007. The utility also said at the time it would pay 5 million pounds to low-income customers following talks about a March 2006 regulatory report that it submitted incorrect data in 2002 and 2004.

Severn Trent in July was docked 2 million pounds in court after pleading guilty to charges from the U.K.’s Serious Fraud Office for hiding leakage data from the regulator in 2001 and 2002 to avoid costly repairs. No individuals were charged.

Customer bills will need to rise “slightly above inflation” so that the company can fund a planned 3.2 billion- pound investment program in the five years through 2015, it said last month. Utilities have submitted proposals to Ofwat for how price limits and customer-service and infrastructure improvement targets should be determined for the period.

Chief Financial Officer Mike McKeon said in June that the company has hedged for 93 percent of energy costs this fiscal year and expects electricity charges to rise by about 10 million pounds from last year.

The company will announce first-half results on November 25th.

French group EDF has agreed a £12.5 billion takeover of British Energy in a move set to kick-start the UK’s nuclear power strategy. The state-owned utility giant will pay 774p a share, 9p higher than the price offered in July which was rejected as too low by major British Energy shareholders. British Gas parent Centrica is also in talks to buy a 25% stake in the new British Energy following the deal, it was confirmed on Tuesday. Prime minister Gordon Brown welcomed news of the takeover as “good value for the taxpayer and a significant step towards the construction of a new generation of nuclear stations”.

The deal will see EDF take control of all of British Energy’s (BE) nuclear power stations and play a leading role in the development of new stations in the UK, which are likely to be built on BE’s existing sites. It will also allow the UK Government to bank a multi-billion pound windfall from its 36% stake in the firm. EDF said on Wednesday it planned to build four new nuclear reactors in the UK and would maximise the potential of British Energy’s eight nuclear power stations. But the Government has stressed that it wants other players in Britain’s nuclear power industry. British Energy employs around 6,000 staff and produces around a sixth of the UK’s electricity. EDF pledged to “recognise and appreciate” the importance of BE employees and said it would safeguard their employment and pension rights. Pierre Gadonneix, chairman and chief executive of EDF, said: “For EDF, this is an historic milestone in our strategic development plans in Europe and enables the EDF Group top develop significantly in the UK one of its key markets. “For British Energy it places it at a the vanguard of new nuclear build in the UK and at the centre of the global nuclear renaissance.”