Abstract
Overview
Introduction
This brief examines tariff innovations in the UK residential energy market.
Two categories of innovations are covered. Firstly, alternate pricing
mechanisms in selling electricity and gas to residential consumers, such as a
capped/fixed tariffs. Secondly, alternate products or services such as carbon
neutral tariffs or energy saving plans
Scope
- An analysis of tariff innovations in the UK residential energy market.
- An assessment of risks associated with the innovations presently marketed,
explaining why some are niche, whilst others are viable for mass-marketing.
- An explanation of how capped/fixed offers are presently the only viable
mass-market innovation, with descriptions of every supplier's scheme.
Report Highlights
To date, innovation has focused on niche tariffs, exploiting regulatory
opportunities, rather than structural change to the way energy is sold. Most
existing innovations are niche as they carry more risk than standard tariffs:
the capped/fixed offer is the exception.
If capped/fixed offers benefit rather than exploit customers, tariff
innovation may grow from its current niche positioning.
A major innovation of recent times has been the capped/fixed price offer, this
is a major shift for the UK retail market. Opportunities exist for further
wholesale-market innovations, yet there is little onus on suppliers to exploit
them.
Reasons to Purchase
- Gain insight into why tariff innovations have been niche and how
capped/fixed offers may be the first wholesale-market related tariff to break
this.
- Understand what tariff innovations exist in the UK residential energy
market and their standing in the market.
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