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On this page you will find company news about Business Cost Consultants, and utility industry news about electricity, renewable energy, gas, water, fixed and mobile telecoms, and other stories. Our news is updated at least once per month. We cover items such as developing technologies, price changes in the utility markets, takeovers and company collapses, changes in tariffs, the results of investigations by the regulators and market trends.

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Recent news

Scottish Water freezes charges for 2012/13

Wednesday, January 25, 2012

A price freeze announced by Scottish Water today means prices have not increased for the fourth year running.

A Scottish Water spokesperson said the company would continue to invest in tackling leakage and improving service, despite its customers paying one of the lowest average annual household bills in the UK at £324. In fact investment will total £2.5bn in the current five-year AMP cycle.

Edie news
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Ofwat to look at social tariffs and abstraction reform

Friday, January 13, 2012

Ofwat has updated its 2012-2013 work programme to include projects on social tariffs and abstraction reform.
This reflects proposals made in the Government's Water White Paper, which was unveiled last month. The document sets out consultation on Ofwat's forward work programme for the coming financial year, focusing on projects in the pipeline as opposed to routine activities. These include projects, such as the Thames Tideway project and license reform.

In a foreword to the programme, Ofwat chairman Phillip Fletcher and chief executive Regina Finna said they were "delighted" the Water White Paper included a "promise of legislation".

As a result, Ofwat confirmed it was already looking at how it will support the Government's aims, as well as continuing work to deliver better regulation, implement market reform and contribute to sustainable development.

It also outlined plans for further consumer protection and said a consumer policy statement would be published in April 2012.

According to Ofwat it is aiming to change the way it regulates: "We are now entering a new phase of activity where we are starting to take firm decisions about the shape of our future regulatory framework - rather than exploring a range of possible solutions."

Consultation on the work programme is open until February 6 and the final forward programme is set to be published by March 31.

The full document can be downloaded here.

Department of Energy and Climate Change
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Heat scheme hots up

Thursday, January 12, 2012

Umbrella company and holiday cottages are first two successful applicants to low carbon heating incentive.

Umbrella supplier Booth Brothers in Sheffield entered the history books today by becoming one of the first places in the UK to get the government’s Renewable Heat Incentive.Its offices, housed in an 18th century former corn mill in Penistone, will be kept warm through an underfloor heating system powered by a renewable energy heat pump.

The second installation to be accredited is at a set of holiday cottages in East Yorkshire. A ground source heat pump will provide heat and hot water to five holiday lets at Broadgate Farm Cottages in Beverley.The £860m Renewable Heat Incentive (RHI) was launched last year to make it more financially attractive for industry and businesses to install low carbon heating systems like heat pumps, biomass boilers or solar thermal panels.

The RHI is expected to increase the number of installations in industry, the commercial and public sector by seven times to around 126,000 and support the thousands of existing jobs in the heating sector.

Climate Change Minister Greg Barker said:

“It’s fantastic news that the Renewable Heat Incentive has received its first two successful applicants, and this is just the start.

“Renewable heat is a largely untapped resource and an important new green industry of the future. It’ll help the UK shift away from fossil fuel, reducing carbon emissions and encouraging innovation, jobs and growth in new advanced technologies.”

Chief Executive of Booth Brothers, Charles Booth said:

“Being amongst the first installations to be accredited under the Renewable Heat Incentive is very satisfying for Booth Brothers in terms of developing our strategic target of carbon neutral for our Bullhouse Mill site and eco-umbrella factory. Last year our Old Corn Mill offices were commended for their eco rating and we generate electricity from two wind turbines, solar panels and hydro generation so making the heat we use low carbon was naturally the next step.”

Owner of Broadgate Farm Cottages, Elaine Robinson said:

“We don’t have mains gas and the price of oil and LPG is very expensive so when we decided to develop the holiday cottages a ground source heat pump was the most economically attractive in the long term, especially with the Renewable Heat Incentive. This is the first of our applications to be approved.”

Currently around half of the UK’s carbon emissions come from the energy used to produce heat – more than from generating electricity. The RHI will reduce emissions by 44 million tonnes of carbon to 2020, equivalent to the annual carbon emitted by 20 typical new gas power stations.

Over 95% of heat in the UK is currently produced by burning fossil fuel but with North Sea supplies now in decline leading to an increase in imports, low carbon alternatives are needed.

Department of Energy and Climate Change
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Mandatory emissions reporting decision could be delayed further

Wednesday, January 04, 2012

Policy of removing regulations before introducing new rules threatens to push consultation beyond April deadline
Rules requiring companies to report on their greenhouse gas emissions look set to be delayed until later this year due to a bottleneck in the government's legislative process.

A consultation on four options including both mandatory and voluntary reporting closed in July and the government was expected to publish a further consultation on its preferred option by the end of 2011 in order to ensure it complies with a timeline set by the Climate Change Act.

The Act says that by April 6 2012 the government must either introduce a legally-binding carbon reporting regime or explain to Parliament why it has not done so.
A number of ministers are understood to be keen on introducing mandatory reporting rules and the proposals also have the backing of influential industry groups.
Dr Matthew Brown, head of energy and climate change at the CBI, told BusinessGreen mandatory reporting would help businesses save money and carbon, and be a much better driver of change than the CRC performance league table.

However, a pledge in the coalition agreement means the government cannot introduce a new regulation without removing another one.

Speculation is mounting that the government is struggling to comply with this "one in, one out" policy, leaving the regulations stuck in limbo and ministers facing a race against time to consult before the April deadline or be forced into an embarrassing delay that could be subjected to a legal challenge.

Speaking to BusinessGreen, a Defra spokeswoman admitted the government may miss the April deadline to bring in new rules, but insisted any delay would be explained to parliament in accordance with the Climate Change Act.

"To make any changes we would need to consult first and that could take us beyond April," she said. "By the 6th April we definitely will have a consultation or explained the situation to Parliament."

Martin Baxter, executive director of policy at the Institute of Environmental Management and Assessment (IEMA), said the delay at least made it more likely that the government was looking to bring in mandatory reporting.

He added that the government may look to tie in the regulations to proposed changes to the future of corporate reporting outlined in a separate Department of Business, Industry and Skills (BIS) consultation, whose proposal to change the Companies Act could come into force in October. Defra was unable to confirm whether this option was being considered.

Baxter said such a move would make more sense for businesses, but urged the government to outline its proposals for mandatory reporting as soon as possible to give companies sufficient preparation time.

"Just because the regulations are still in development that doesn't mean [the government] doesn't need to get on with outlining the mechanism and the size of companies covered," he told BusinessGreen. "The longer we can give companies to prepare the more likely they are to have data management processes embedded."

His views were echoed by Andrew Raingold, executive director of the Aldersgate Group of companies, NGOs, and MPs, who said the delay sent "mixed signals" about the government's desire to simply the complex landscape of environmental legislation.
"We would welcome an amendment to the Companies Act as [emissions] reporting is a business issue and should be part of that," he said. "But the government still needs to give clear signals about its intentions and more detail of requirements."

However, Lois Guthrie, executive director to the Climate Disclosure Standards Board, said the delay was unnecessary.

"It's a little odd that in 2008 Defra could lay down a requirement that something has to happen by 2012, but not also say that this could be over-ruled," she said.

"Defra could always introduce a requirement for mandatory reporting and work out the details later, or let someone else do it."

Business Green
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Energy Minister looks forward to 2012

Wednesday, January 04, 2012

Energy Minister Charles Hendry set out his hopes for a “prosperous 2012” in the oil and gas sector, as he awarded 46 new licences to explore for hydrocarbons in the North Sea.

These awards were made as part of the 26th offshore oil and gas licensing round, which was originally announced in October 2010. This licensing round awarded 144 licences but held back a number of blocks from award due to the need for further assessment on Special Areas of Conservation (SACs) and Special Protection Areas (SPAs).

Charles Hendry, Minister for Energy, said:

“Oil and gas remains crucial to the UK economy – contributing around 2% to the country’s GDP. Our innovative licensing system continues to make the UK one of the most attractive places to do business.

“These further licences have been subject to rigorous examination, and we are now satisfied that initial exploration can go ahead.

“These continued high levels of interest, and the award today of these licences, gives me yet more reason to be optimistic for a prosperous 2012 for the UK oil and gas sector.”

Edie News
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Business 'back-billing' may be cut to one year

Wednesday, December 07, 2011

Ofgem wants energy suppliers to cut down the period they can "back-bill" microbusinesses, when the suppliers have made mistakes over the billing, to one year. The regulator also asked suppliers to extend that approach to bigger business customers.
The energy regulator was responding to proposals to address back-billing of business customers put forward by the Energy Retail Association and gas retailers group ICOSS. The two supplier groups have been working with consumer groups to develop their own proposals for dealing with the issue.

Ofgem welcomed the groups' self-regulatory approach but the parties have not yet settled on the final form of standards to be applied to back-billing from January 2012. Suppliers wanted to be able to back-bill for up to three years. Ofgem, however, agreed with consumer groups that where the supplier was at fault the "aspiration" should be to move to a one-year limit for back bills. It said "we welcome, in the meantime, any moves by suppliers towards this shorter time period".

The regulator added, "We note that the draft standards have been developed to apply to micro-business customers, but consider that the principles should be applied to non-domestic customers more broadly".
Source: Utility Week

Utility Week
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£64m for renewable power links

Thursday, December 01, 2011

SSE, formerly Scottish & Southern Energy, was yesterday given the go-ahead for £64 million-worth of upgrades to its power distribution network in order to plug more renewable energy projects into the national grid.

The £34m Northern Isles New Energy Solutions project will allow small-scale renewable energy schemes to supply more of the power needed on Shetland.

Under the £30m New Thames Valley Vision programme, SSE will study how energy generation and demand changes during the day when solar panels are connected to the grid and when customers have recharging points for electric vehicles.

Mark Mathieson, managing director of SSE’s power distribution arm, said: “These projects will allow us to anticipate, understand and support behaviour change in individuals, small businesses and larger companies.”

Rachel Fletcher, Ofgem’s acting senior partner for smarter grids, governance and distribution, added: “Lessons learned from the projects will be shared with all network companies and other interested parties.”

Funding for the projects comes from Ofgem, the UK government’s Department of Energy & Climate Change, the European Union and SSE.

Scotsman
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Local business launches impartial price comparison site in response to recent energy price increases

Friday, November 25, 2011

Business Cost Consultants (BCC), one of the UK’s leading independent utility consultants, has launched an impartial energy price comparison site in response to recent hikes in electricity and gas prices throughout the UK.
The Glasgow-based company was asked by several of their housing association clients about ways to help their tenants save on energy costs. BCC’s team advised that consumers who haven’t reviewed the market for the last six months are more than likely paying too much for electricity and gas.

Based on the feedback from housing associations and tenants, the site has been developed to allow users to quickly input some basic details and compare every tariff on the market to find the cheapest deal to suit their needs. You don’t even have to have any paperwork with you to complete the form. It takes approximately 5 minutes to complete the form and average savings to date are more than £200 per annum.

Unlike some other comparison sites, www.switchmyenergy.co.uk is 100% impartial and shows prices form every single supplier.

Recent research has found that many people stick with the same company for many years, give their supplier their loyalty. Unfortunately, this loyalty often means profits for the energy companies. The suppliers benefit from customers sticking with them because the price schedules are often “phased out.” In the industry, those price schedules are known as “tariffs”. If the customer does not move from an out-of-date tariff, they usually default on to an expensive rate. Therefore, the supplier gets bigger profits from you.

The site is now available for all domestic consumers to use. For users that may not have internet access, a Freephone number is available.

To find out more visit www.switchmyenergy.co.uk or call 0800 410 1262.
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Huhne outlines details of Green Deal scheme

Thursday, November 24, 2011

A consultation on the Green Deal was launched today, outlining plans to stimulate billions of pounds of private investment home energy improvements over the next 10 years. However, Mr Huhne also said energy prices would rise by some 27% by 2020.
Published as part of his Annual Energy Statement to Parliament, the Energy and Climate Change Secretary Chris Huhne said £14bn of private investment would not only mitigate some of the effects of energy price rises, but would also create thousands of jobs in the insulation and construction sector.

Today's consultation outlines three main benefits of the proposed Green Deal framework, which would be launched from October next year.

Firstly, homes and businesses in Britain will have access to finance to install energy-saving technologies, with no upfront outlay and repayments made over time when savings are being made

Secondly, the scheme will be funded in part by the six dominant energy providers in the UK who will provide £1.3 billion a year.

Thirdly, it should act as the catalyst for around £14bn of private sector investment over the next decade. And, unlike with previous insulation schemes, the government has undertaken to include new safeguards to "help small family firms as well as big high street names become involved". Mr Huhne said his department estimated the Green Deal could support "at least 65,000 insulation and construction jobs by 2015".

Mr Huhne also unveiled new analysis that found the Government expected its own policies to contribute to a 27% rise in the cost of energy between now and 2020. However, it said that overall average household energy bills will be 7% lower under current plans, equating to a £94 saving per annum. Those savings are to be acheived through energy-efficiency measure such as those outlined in the Green Deal.

In an emotive speech Mr Huhne said: "The Green Deal is about putting energy consumers back in control of their bills and banishing Britain's draughty homes to the history books. By stimulating billions of pounds of private sector investment, the Green Deal will revolutionise the way that we keep our homes warm, making them cosier, more efficient - and all at no upfront cost.

"The Green Deal is also a massive business opportunity for firms up and down Britain, helping to power the economy and creating jobs. From one-man bands and local authorities, to the big supermarkets and DIY stores, we want as many providers getting involved as possible because that's what will give consumers the best deal.

"I want to insulate Britain's homes not just from the cold weather, but also from the chill winds of global fossil fuel prices. It's these that are pushing up consumer energy prices, and it's why our balanced package of policies aimed at achieving energy savings and shifting to more home grown alternatives is the right one for the economy and all of us who pay energy bills.

"There are certainly costs to replacing our ageing energy infrastructure with modern, clean power stations, and we take very seriously any impact of our policies on what consumers and businesses pay. We've repeatedly taken steps to reduce this - by removing some planned levies on bills and making others more cost effective and within budget.

"But a crucial - and too often ignored - priority of our whole strategy is to reduce the amount of energy we use in our homes."

Edie News
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British Gas to make changes after 'loss of trust'

Thursday, November 24, 2011

British Gas has said it is simplifying its tariffs after acknowledging a lack of public trust in the energy industry.
Managing director Phil Bentley told the BBC his company "had not made it easy for customers".

As a result, he said all customers will be able to choose between two tariffs - variable and fixed - and benefit from more transparent bills.

Earlier this year, the regulator Ofgem told energy companies they must offer simpler tariffs.

Following a comprehensive review of the UK energy market sparked by claims that energy companies were making excessive profits, Ofgem said suppliers needed to change the way they operated by next year.

Ofgem welcomed British Gas's "recognition that suppliers need an open and honest dialogue with their customers".

It said it would examine the company's proposals "in detail" to see how far they met its own objectives to simplify tariffs.

Earlier this week, E.On announced it had "pressed the reset button" on its relationship with customers, while other major energy suppliers have said they are working towards simplifying their tariffs.

'Complete breakdown'

Mr Bentley told the BBC that British Gas was making the changes because its customers had said they did not like the current pricing structures.

"We are very conscious of our social responsibility," he said.

He said bills were going up in part due to increasing transport costs and green levies.

He also admitted that British Gas had offered cheap deals as loss leaders in order to attract customers. The company would no longer be doing this, he said.

"It is not right if we are charging honest customers more [to fund these deals]," he said.

The supplier is sending a letter to all its customers explaining its new policy, in which Mr Bentley says: "It is clear that we need to make things better for our customers. To make sure we do that, I am committed to having an honest conversation with [them]."

As well as offering just two tariffs, the supplier said that, from this month, it will include a "complete breakdown" of all the costs that make up its customers' bills.

Earlier this week, British Gas announced it had secured a £13bn gas supply contract with Norway's Statoil designed to help insulate customers from volatility in global gas prices.

E.On said its own review would take six months to complete, and would look at tariffs, bills, customer support and how it sells its products.

As well as calling for simpler tariffs following its review, Ofgem said it had found evidence the so-called big six energy firms had increased their prices in response to rising costs more quickly than they had lowered them in response to costs falling.

The suppliers, it said, should face more competition.
BBC News
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Ofwat unveils new price limits consultation

Wednesday, November 23, 2011

Ofwat has today published a consultation document on how it intends to set limits on the prices water and sewerage companies can charge customers in the future.
According to Ofwat's 'Future price limits - a consultation on the framework' paper, the new limits will ensure customers "get a fair deal" and that companies can "continue to raise finance to improve services".

The consultation encourages companies to focus less on "investment-heavy" engineering solutions and instead seek better value, more environmentally sustainable alternatives, such as water trading.

In addition to setting out a framework for setting price limits, the consultation outlines how a regulatory approach will enable the sector to develop efficiently by giving companies increased responsibility and accountability.

Other key changes by Ofwat include involving customers in outcomes, setting wholesale and retail price limits, changing the way it assesses costs, a focus on incentives and simplifying the process.

In 2009, Ofwat set limits on the prices water and sewerage companies could charge customers for the five years period 2010 - 2015. New price limits are expected to be set in 2014.

Population growth, climate change, rising consumer expectations, affordability concerns and pressure to invest to deliver improvements to service and the environment are all thought to pose significant challenges for the sector. Water scarcity is also having a major impact on how companies in the water sector operate.

As a result, Ofwat says its framework recognises these issues and focusses on addressing them by taking a long-term view. It also advocates water trading, which it argues will enable companies to provide customers with affordable services and reduce the impact on the environment.

Commenting on the changes, Ofwat chief executive Regina Finn, said: "There are now significant new challenges ahead, including climate change, population growth and rising consumer expectations. In many areas water resources are becoming more stretched. We need to become smarter in how we value, manage and use our water. Our proposals look to build on the solid platform we already have, and tackle these challenges head-on.

"Customers play a critical part in our proposals. They need to know that bills are fair and legitimate. This framework will enable the sector to deliver sustainable solutions for their customers. That means the sector can keep bills down, continue to attract further investment, and deliver safe, reliable supplies for decades to come."

Following the consultation, Ofwat is set to publish a decision statement in spring 2012, setting out the principles it will use to set price limits. This will be followed in autumn 2012 by a more detailed consultation on the methodology used for the next price review process.

A copy of the consultation can be downloaded here.

Edie News
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Ofgem in crackdown on business energy suppliers

Tuesday, November 22, 2011

The energy watchdog Ofgem has set out plans to help UK businesses change their energy supplier more easily.
One of the regulator's key concerns is that some firms are being automatically rolled over into new contracts, which can last up to three years, often without their knowledge.

It has also promised to crack down on suppliers that prevent firms from switching supplier.

The pledge comes as part of its a general overhaul of the energy market.

A month ago Ofgem announced proposals for a simpler and more competitive energy market for households.

Now, the regulator has set out new standards of conduct, backed with financial penalties to improve supplier behaviour towards businesses as well.

Research has found that some businesses have been prevented from switching because of a high number of objections from suppliers.

Ofgem said it wanted businesses to get a clear warning when their contracts are due to end and what they can then do to find a new energy supply deal.

Ofgem's chief executive, Alistair Buchanan, said: "During our investigation into the energy market, businesses told us about a range of problems they were having with energy suppliers and also some energy brokers.

"As we have demonstrated in the domestic market, we will also take a tough line on any suppliers we find systematically breaching rules designed to protect businesses."

Ofgem is planning to ask the government for new powers to take enforcement action directly against brokers for any misleading marketing in the business sector.

It currently has no powers over energy brokers.


BBC News
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British Gas owner Centrica says gas prices on the rise again as it warns on profits

Friday, November 18, 2011

British Gas owner Centrica has told investors it expects profits to come in below target after energy use dropped during the unseasonably warm autumn, and warned gas prices could be on the rise again.
The energy supplier said average residential gas consumption was 17 per cent lower this year compared with a year ago, with electricity usage down by 3 per cent after the unusually warm weather in recent months.

The number of customer accounts has also fallen to 15.9million from 16.1million in the summer after the UK's biggest energy supplier lifted gas and electricity prices by an average of 18 per cent and 16 per cent respectively from August.

Centrica shares dipped after the announcement and were 3.25p, or 1.1 per cent, lower at 291.55p in early trading today.

Centrica said it now expects operating profits for 2011 will be marginally lower than current market expectations of £2.6billion, a figure which compares with a surplus of £2.4billion in 2010.

Prior to today's update, analysts had expected a 20 per cent fall in profits at the British Gas Residential business to around £600million.

It said wholesale gas and oil prices were 26 per cent higher this winter than last year and added that its residential business was loss-making prior to the announcement of higher tariffs.

The announcement will send chills down the spines of householders who are already struggling under crippling energy bills. Energy suppliers, including Centrica, are being investigated by regulator over their behaviour around price rises.

Critics says that suppliers are quick to raise bills in response to wholesale price rises, but take far longer to lower bills when costs fall. They also allege that suppliers use complex accounting to reduce residential energy profits so as to avoid accusations of profiteering.

Centrica said that average consumption by business customers has also been affected by the mild weather and weak economic conditions, with a reduction in usage of 15 per cent for gas and 12 per cent for electricity.

In residential services, the number of central heating installations was 10 per cent lower than a year earlier.

While this is better than the overall market, Centrica announced yesterday it will cut around 850 jobs after reviewing resource levels in its services business.
The move is part of an ongoing review to identify cost savings across the group, including in its UK power generation division.


This is Money
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Isle of Wight aims to become net energy exporter

Wednesday, November 16, 2011

The Isle of Wight aims to become a net green energy exporter to the rest of the UK and Europe by capitalising on its renewable power capabilities.
At a launch event today (November 15) at the House of Commons in central London business leaders from the island and around the world laid out a vision for an 'Eco-Island'.

According to Eco Island Partnership founder and chief executive, David Green, the Isle of Wight can not only become energy self-sufficient but also be an energy exporter.

Mr Green explained: "I would like, for a minute, to transport you forward to a future where the Eco Island vision has become a reality.

"Driven by a dwindling supply of fossil fuel and utilizing a range of renewable sources including wind, solar, tidal, and geothermal power the Island has become totally self-sufficient in energy.

"Utilizing their smart grid and energy storage system the Island is able to balance it's supply and demand and has become a net energy exporter to the 'Big Island' to the north."

The plan is backed by Government minister, Oliver Letwin, who told the launch it was a 'remarkable' example of the Big Society.

He said: "The huge well of local support has been strengthened by professionalism and skills and that's the very combination which will move mountains."


Edie News
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Business Cost Consultants to exhibit at SFHA Finance Conference 2011

Tuesday, November 15, 2011

Business Cost Consultants (BCC), one of the UK’s leading independent utility consultants, will exhibit at the SFHA Finance Conference 2011 Glasgow on the 15th and 16th of November at Crieff Hyrdro Hotel, Perthshire.
The Conference will address the key issues that are dominating the headlines, such as the current economic climate, and will be attended by housing associations and cooperatives through to regulators, bankers, local authorities and the Scottish Government.

With the funding landscape for associations having changed so dramatically in the last three years, the conference will provide useful insight into strategic planning to the customary updates on tax, VAT and legal issues.

BCC have been working with housing associations and charities over the last 16 years to help them reduce electricity, gas, water and telecoms costs. BCC’s team will be on hand during the day to provide advice on reducing energy, water and telecoms costs and to highlight how their clients have saved thousands over the years.

Clients include associations such as Fife H.A., Glasgow West H.A., Grampian H.A, New Gorbals H.A., Paisley South H.A., Shettleston H.A., Thenew H.A. and Whiteinch & Scotstoun H.A., to name but a few. The company, based in Glasgow, has a track record of savings of between 15-49% for housing associations.

Donald Maclean, Managing Director at Business Cost Consultants said, “Over the last few years housing associations have found it tougher than ever given the recent economic climate, which is why many of our clients have turned to us to help them reduce their utility costs. We are looking forward to meeting many of our clients at the event and look forward to being able to provide useful advice to other associations who are keen to reduce costs.”

The event will be held at Crieff Hydro Hotel, Perthshire on the 15th and 16th of November. For further details visit http://www.sfha.co.uk/
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