Energy Pricing & Modern Brokering – An interview with Pierre Tabet
Pierre is a software engineer and was previously CTO at izaac, a French energy management company. He is currently CEO and Founder of VoltView. A new energy platform that is designed to make switching energy suppliers and managing billing simpler and quicker.
Pierre gained a 1st Class Honours in Mechatronics, Robotics and Automation Engineering from the University of Leeds.
Following our interview with Kit Oung. We sat down with Pierre to find out more about the challenges around energy pricing and supplier market, and what VoltView has done to support SMEs in this sphere by bringing the whole process under one roof.
Q) You have previously worked in a French energy company. How different are the energy markets in France compared to the UK?
The UK is a more liberalised market, where thousands of intermediaries sit between suppliers and end customers, and where prices are set by gas-fired marginal generation even when most electricity on the grid is coming from cheaper sources. France is structurally very different and has around 70% of electricity production coming from nuclear, which gives the system a stable, lower-cost baseload and shields businesses and consumers from the kind of volatility UK customers have lived through.
The UK has had decades of bad energy policy. The country stopped building nuclear in the mid-1990s, became heavily dependent on gas, and is now layering very large subsidies on intermittent power. Those subsidies, together with the system costs they create in transmission, grid balancing and backup capacity, all end up on business and household bills. The wholesale cost of electricity is only around a third of what a UK customer actually pays. The rest is non-commodity costs that policy choices have driven up year after year. France made large investments in nuclear in the 1970s and is still benefiting from it.
Q) What are the challenges you see in the UK market in terms of pricing and brokering?
The ratio between gas and electricity unit rates is a real problem. A heat pump is three to four times more efficient than a gas boiler, but if electricity is 24p per kWh and gas is 6p per kWh, there is no economic benefit to electrification. Once you add capex and current interest rates, the numbers rarely work.
The other challenge is data. Market-wide half-hourly settlement is coming, but the metering rollout is too slow. Without half-hourly data on every non-domestic meter, suppliers cannot price accurately and customers cannot compare like for like.
Q) Which brings us onto the main question. What is VoltView? What made you start it?
VoltView is an energy service and app for busy SMEs. It brings procurement, bill validation, consumption analytics and supplier integration into one place. The platform currently manages around £3 million of utility spend across 100+ locations, and has reclaimed over £400,000 in billing errors on behalf of clients.
The reason for starting it is that commercial energy is broken for the average SME. The market is complicated, full of jargon, and short on trustworthy advice. UK businesses have none of the price cap protections domestic customers have, and most simply do not have the time or in-house expertise to manage it properly.
VoltView is a finalist in the Government’s Smart Data Challenge Prize and a case study in the Government’s Smart Data Strategy.
Q) How does VoltView make the management of energy billing and supply easier for end users?
VoltView pulls meter data, contracts and bills into one place, validates every invoice automatically against the contracted rates, and quotes new contracts off real consumption rather than annualised estimates.
Q) My contract is up for renewal, and I want to switch to a more affordable supplier. How many clicks is that on the platform?
A handful of clicks. The customer’s consumption is already in the system through direct supplier integrations or aggregation partners, supplier quotes come back on a like-for-like basis with fees disclosed, and the contract is signed in-platform. The normal route is weeks of phone calls and emails and trusting that the right deal has been put in front of you.
Q) You have worked with energy suppliers to obtain their pricing information. The ability to simply switch saves how much money for your current customers?
Customers typically see 15-24% in cost savings, on top of billing errors caught and reclaimed. Over £400,000 in errors has been reclaimed on behalf of clients so far.
Q) Is there any legislation or regulation coming into force in the future that will make the landscape easier for the end users or VoltView?
Over the next few years all non-domestic meters in Great Britain will start to settle on actual half-hourly consumption, which finally makes time-of-use tariffs more viable. The Data Use and Access Act lets Government mandate data sharing across the economy. Open Banking was the first such mandate and Open Energy will likely follow.
Q) With the growing move to renewables as a source of electricity generation in the UK. Do you see any value in decoupling electricity from gas prices?
There will be no decoupling without much higher nuclear or storage. Gas sets the wholesale electricity price about 97% of the time, even though it generates only around a third of UK electricity. As long as gas is the last marginal generator, gas sets the price for everyone, including renewables on the system.
Q) Have you seen an effect on the markets following the war in Iran? Or do you see an effect coming as a result?
Tensions involving Iran feed through to UK prices via imported LNG, since the country is still on gas-set marginal pricing.The more storage and baseload the UK has the less it has to rely on imported gas for electricity.
Q) What advice would you give to end users when considering their next energy supplier?
Talk to your broker and ask which suppliers they work with and what risks they see in any particular one.
Q) Finally, where do you see VoltView in the next 5 years?
The aim is to make utilities admin a thing of the past for SMEs. Procurement, bills and advise all accessible through one app.
