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Centrica readies new distributed power platform as strategic shift kicks into gear

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British Gas owner Centrica has revealed it aims to release a new suite of online tools for consumers as it makes full use of its decentralised energy and power division.

The portfolio is to be released to consumers as the firm continues its strategic shift to more consumer-facing and distributed business interests, and away from its legacy centralised divisions.

Centrica has enacted a major transition away from centralised generation as it embraces a more distributed future. So far this year it has either disposed or announced the disposal of around £800 million worth of centralised generation assets, and continues to shift resources towards customer-facing units.

It aims to allocate around £1.5 billion of capital towards such units by 2020 and this morning provided some insight into where that investment will go.

Firstly, the company is currently assessing the potential for it to bring its ‘Energy Portfolio’ platform – an online tool offered to consumers in North America – to the UK market for the first time. The platform allows consumers to be more proactive and selective in how they procure their energy and “better understand” the energy market in general.

Centrica is also aiming to develop new tools using software and capabilities it has inherited through its acquisition of energy trading specialist Neas Energy and energy management firm Panoramic Power.

The ultimate aim, Centrica said, is to develop a single portal for consumers, based on cloud-based integration, which would address “all five pillars” of its customer proposition and allow consumers to access Centrica’s full suite of products and services in one place.

Centrica has previously established those five pillars to be energy supply, services, peace of mind, home energy management and home automation, bringing in factors such as appliance control, energy efficiency and electricity supply.

The tool will look to capitalise on continued growth within Centrica’s decentralised energy and power division, which has recorded 25% growth in its top line in the first six months of 2017.

The number of generating sites controlled by the division has increased by 11% year-on-year to 4,236, while the number of households collated within Centrica’s connected homes unit has surged by 81% to around 660,000.

But while there have been a number of forward-looking announcements within Centrica’s H1 release, its decision to increase power prices by 12.5% from mid-September has attracted criticism.

The increase in its standard tariff, which Centrica says is its first since November 2013, is expected to affect 3.1 million customers and has been blamed by Centrica consumer chief executive Mark Hodges on an “underlying increase in policy and transmission costs”.

However its blaming of policy costs has been attacked by other stakeholders in the power market.

“Instead of pointing the finger at policy costs – which have been shown to cut overall bills by reducing waste - British Gas should be looking to the long term and backing low–cost renewables and smart, flexible technology which have been reported time and time again as offering billions of pounds of benefits to UK homes and businesses,” Jonathan Marshall, energy analyst at the Energy and Climate Intelligence Unit, said.


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