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industry & government news

BOSS OF BRITISH BRILLIANT ENERGY JOINS

GAS OWNER GETS
44% PAY RISE AS LIST OF FAILED UK POWER

4,000 JOBS ARE CUT AND GAS UTILITIES

THE BOSS OF British Gas owner
Centrica saw his pay jump 44 per
cent to £2.4 million last year while
the company cut thousands of jobs
and issued a profit warning.
Chief Executive Iain Conn enjoyed
the bumper pay rise despite British
Gas losing 742,000 customers in
2018 as households switched to rival
providers. That was an improvement
on the 1.4 million British Gas lost in
2017 when Mr Conn was paid £1.7
million, reports The Independent.
Conn is paid around 59 times more
than the median British Gas worker,
who earns £41,822. Meanwhile
prices for consumers have soared.
More than half of British households
saw bills rise by an average of more
than £100 after regulator Ofgem
increased its energy price cap.
But Mr Conn saw his total pay rise
sharply as he collected an annual
bonus, according to the company’s
annual report. ANOTHER SMALL SUPPLIER BITES THE DUST
In February, Centrica warned that
profits will be £300 million lower
because of Ofgem’s cap, which was BRILLIANT ENERGY has become that was not long ago monopolised by
introduced in December. the latest UK energy supplier to fold the so-called ‘Big Six’. The number of
Centrica’s annual report said: “Iain in a further sign that many smaller electricity and gas suppliers rocketed
has shown significant resilience in providers are not equipped to cope from 14 in 2011 to a peak of 73 in June
the face of this challenge and has led with market volatility. last year.
the business through the shifting Brilliant, which supplied around But the models of many of these
context, keeping the strategic 17,000 customers, ceased trading in ‘challengers’ have proved to be
objectives in sight and ensuring that mid-March, becoming the third to do unsustainable, leading many to crash
the organisation remains adaptable so this year and the 11th since January out when trading conditions become
and innovative.” 2018 — not including a further four more difficult, prompting calls for a
The first of Centrica’s latest round that quit the market last year through rethink of how the sector is regulated.
of job cuts began with up to 500 staff corporate transactions. Ofgem said it plans to open
axed following the closure of offices Around one million UK electricity a consultation with industry
in Glasgow and Leeds. and gas customers have now been participants on bringing in new checks
The rest of its planned cull of displaced by the spate of failures in for incumbent players — on top of
workers is to take place over the next the market since the beginning of last the additional requirements for new
three years. year, reports The Financial Times. entrants — in the coming months.
Centrica has The latest example comes just Brilliant’s exit from the market follows
let 5,500 months ahead of Ofgem’s introduction that of Coventry-based Economy Energy
employees go of new rules to make it more difficult and Scottish not-for-profit Our Power in
since the start for energy companies to begin trading January, which had 235,000 and 38,000
of 2016. in the UK. The regulator plans to customers respectively.
introduce entry standards that would Its customers — including those
require would-be suppliers to have supplied under a ‘white label’
enough financial support to sustain arrangement with Northumbria Energy
themselves for at least a year. — will be transferred to a new provider
New technology and low barriers by Ofgem and their credit balances will
to entry have driven a rapid rise in be protected through the regulator’s
the number of suppliers in a sector safety net process.

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News.indd 4 16/04/2019 19:34