Energy firm guilty of mis-selling

10 May 2011 Last updated at 13:39 ET  SSE is thought to be the first big energy firm to be prosecuted for mis-selling Scottish & Southern Energy (SSE), has been found guilty of tricking people into switching from their existing energy firms.

SSE's sales agents had used misleading sales scripts when talking to people on their doorsteps, between September 2008 and July 2009.

It had claimed they were paying too much to their current suppliers when this was not the case.

SSE, based at Perth in Scotland, was found guilty at Guildford Crown Court.

Steve Playle, of Surrey County Council Trading Standards, which brought the prosecution, said he was delighted.

"When we first became aware of the sales script being used by Scottish and Southern Energy we were convinced that it overstepped the mark and was misleading to potential customers," he said.

"A doorstep seller had a print out which he claimed showed consumers were paying too much with their current energy supplier, but the print out did not show this.

"The seller didn't actually have a clue but the sales script was cleverly designed to put potential customers on the back foot and to open the door to a sale," he added.

'Wilful mis-selling' Continue reading the main story

This verdict has revealed a deliberate tactic by SSE, not the behaviour of a rogue salesperson”

End Quote Audrey Gallacher Consumer Focus It is thought to be the first time that one of the big six energy firms has been prosecuted for using dishonest sales techniques.

The problem of doorstep trickery has been plagued gas and electricity consumers since the industry was privatised in the 1990s.

Audrey Gallacher, of Consumer Focus, said the firm's behaviour had involved "deliberate and wilful mis-selling."

"'Misleading doorstep energy sales have been a nightmare for consumers for years, leaving many switching to a worse energy deal," she said.

"This verdict has revealed a deliberate tactic by SSE, not the behaviour of a rogue salesperson."

SSE was found guilty on two counts out of seven charges brought under the unfair trading practices regulations and suggested it might fight the judgement.

"We are clearly disappointed with the verdict today and are now considering our legal options, which includes the possibility of an appeal," the firm said.

"We want to reassure customers, and potential customers, that this case relates to sales aids used in February 2009, which are not in use today, and we are confident that our sales processes continue to be fair and responsible."

Japan 'to review energy policy'

 10 May 2011 Last updated at 10:10 ET  Mr Kan said Japan should look more closely at renewable energy sources Japan is to reconsider plans to increase its reliance on nuclear power in the wake of the crisis at the Fukushima plant.

Prime Minister Naoto Kan said Japan had to start from scratch with its energy plans following the disaster.

The plant has been leaking radiation since the 11 March earthquake and subsequent tsunami damaged cooling systems to the reactors.

Operator Tepco has asked for government help to compensate those affected.

More than 80,000 local residents living within a 20km (12 mile) radius of the plant have been evacuated from their homes.

Agriculture and businesses have been hit and there is no timescale yet for allowing residents to return, although a small group were allowed inside the no-go zone briefly on Tuesday to gather belongings.

Total compensation claims are not yet known, but analysts say they may be more than $100bn (￡61bn).

'Big incident'

Nuclear plants currently supply about 30% of Japan's electricity.

Addressing a news conference, Mr Kan described nuclear power as a "major pillar" of Japanese society, along with fossil fuels.

But he said other forms of energy would also be key in the future.

"The current basic energy policy envisages that over 50% of total electricity supply will come from nuclear power while more than 20% will come from renewable power in 2030," he said.

Access to the no-go zone is banned, but trips are being arranged for residents to gather necessities

"But that basic plan needs to be reviewed now from scratch after this big incident."

"Better safety must be ensured in nuclear power while renewables need to be promoted."

He said greater focus would also be placed on ways of conserving energy, turning Japan into an "energy-saving society".

Mr Kan also said he would not take his prime minister's salary until the plant was under control and would be paid only as a member of parliament.

Tepco (Tokyo Electric Power Company) has said that it may take up to nine months to achieve a cold shut-down at the nuclear plant, which workers are struggling to stabilise.

Cooling systems were knocked out, causing fuel rods to overheat. There were subsequently explosions at four reactors operating at the time of the earthquake.

Engineers are pumping water into the reactors to cool them as they work to restore the damaged cooling systems.

Mr Kan's comments came hours after Tepco said it had presented a formal written request for assistance to Economy Minister Banri Kaieda.

In a statement, the company said it faced "an extremely severe situation" in terms of raising funds and that it needed state help so that "fair and prompt" compensation could be paid to local residents.

It has promised to restructure and executive salaries have already been reduced.

Nuclear Physicist from University of Surrey, Professor Paddy Regan describes Japan's energy profile

Japan's biggest power utility also faces billions of dollars in extra fuel costs to make up for reactor closures at Fukushima.

Shares in Tepco - which serves an area that accounts for 33% of Japan's economy - have plunged since the earthquake and subsequent tsunami.

On Tuesday, Finance Minister Yoshihiko Noda hinted that the government would give Tepco some form of support.

"They can't be allowed to face bankruptcy," said Penn Bowers, an analyst at CLSA in Tokyo. "I think everyone understands they can't be allowed to fail."

Japan Reaffirms Nuclear Energy Use

TOKYO — Japan remains committed to nuclear power despite the crisis at the Fukushima Daiichi Nuclear Power Station, Prime Minister Naoto Kan indicated Sunday, as workers moved closer to repairing the crippled plant by opening the doors of a damaged reactor building.

The view on Sunday from an observation deck at the Hamaoka nuclear plant, which the government wants to shut down until protections can be built.

Japan's Prime Minister reaffirmed the country's commitment to nuclear energy on Sunday, although the Hamaoka plant near Tokyo will be temporarily shut down.

The move is intended to air out the building that houses Reactor No. 1 to ensure that radiation levels are low enough to allow workers to enter. The plant’s operator, the Tokyo Electric Power Company, said the procedure would release little radiation into the atmosphere because an air filtering system installed last week had already removed most of the dangerous particles.

Eight hours after the doors were opened, workers entered the building to test radiation levels. The next step is to begin replacing the reactor’s cooling system, which was destroyed by the tsunami on March 11.

The company has said it will take at least six months to stabilize the plant, in which three of the six reactors were damaged by a magnitude-9.0 earthquake and tsunami. Hydrogen explosions spewed radiation into the atmosphere, causing the worst nuclear disaster since the 1986 Chernobyl accident in Ukraine.

Despite the crisis in Japan, Mr. Kan indicated Sunday that his government was not rethinking the nation’s energy policy. There had been speculation that the government might seek to shut down more nuclear plants after Mr. Kan requested last week that the Hamaoka nuclear plant in central Japan be temporarily closed because of safety concerns.

Mr. Kan told reporters on Sunday that he would not seek to close any more of Japan’s 54 nuclear reactors. He said the Hamaoka plant, 125 miles west of Tokyo, was “a special case” because it sat atop a major fault line. Government seismologists say there is an almost 90 percent chance of a major earthquake on the fault line within the next 30 years.

Critics have long warned of a possible accident at the Hamaoka plant, which is upwind of Tokyo. Mr. Kan asked that the plant be closed until a tsunami-resistant wall could be built and backup systems could be installed to strengthen the plant against earthquakes.

The Hamaoka plant’s operator, the Chubu Electric Power Company, accepted the prime minister’s request on Monday. The company’s board did not reach a decision at a meeting on Saturday, when some board members expressed concern about summer power shortages if the plant were shut down.

The utility company supplies power to central Japan, including Aichi Prefecture, the home of Toyota. In Tokyo, residents face the prospect of electricity shortages because of the loss of the power supplied by Fukushima Daiichi and other plants in earthquake-damaged northern Japan.

Despite the setbacks, Yoshito Sengoku, the deputy chief cabinet secretary, said Japan was not reconsidering its dependence on nuclear power, which supplies about a quarter of the nation’s electricity.

 

Energy Dept. Panel to Revise Standards for Gas Extraction

 

The administration hopes to avoid the safety and regulatory breakdowns that led to the Deepwater Horizon blowout a year ago as it oversees onshore drilling using hydraulic fracturing, also known as fracking.

Energy Secretary Steven Chu has asked the panel’s seven experts, to be led by John Deutch, a former director of the Central Intelligence Agency and deputy defense secretary, to recommend within 90 days immediate steps to make fracking cleaner and safer.

The group will have an additional three months to come up with comprehensive safety and environmental policies for state and federal regulators who oversee gas drilling.

Mr. Chu said that he was acting at the direction of President Obama, who outlined a new energy strategy last month that calls for stepped-up domestic oil and gas production but also new rules to make the business safer.

Hydraulic fracturing involves the high-pressure injection of fluids into underground shale formations to break open natural gas pockets. The technique, which has been in limited use for decades, is expected to significantly increase recovery of domestic gas supplies and keep prices moderate for years.

But the practice also pours millions of gallons of dangerous chemicals into the ground and into wastewater treatment systems, which in some cases cannot remove all the potential toxins. There are also numerous documented cases in which fracking fluids leaked into aquifers and contaminated drinking water.

“America’s vast natural gas resources can generate many new jobs and provide significant environmental benefits,” Mr. Chu said in a statement late Thursday, “but we need to ensure we harness these resources safely.”

Within hours, House Republicans issued a press release denouncing the study as wasteful, duplicative and another example of red tape run amok. They said that fracking has been used safely for more than 60 years and that the Environmental Protection Agency already has sufficient authority to regulate it.

Mr. Deutch, a chemist, is a longtime professor at the Massachusetts Institute of Technology and has served in a number of top government posts. He is a director of Cheniere Energy, which operates a major liquefied natural gas terminal in Louisiana and a number of gas pipelines.

Other members of the panel include Stephen Holditch, chairman of the department of petroleum engineering at Texas A&M University; Fred Krupp, president of the Environmental Defense Fund; Kathleen McGinty, an aide to Al Gore when he was a senator and a former secretary of the Pennsylvania Department of Environmental Protection; and Susan Tierney, former assistant secretary of energy for policy and Massachusetts secretary of environmental affairs.

Also serving are Daniel Yergin, chairman of I. H. S. Cambridge Energy Research Associates and the author of the “The Prize: The Epic Quest for Oil, Money and Power,” a history of oil exploration; and Mark Zoback, a professor of geophysics at Stanford.