View from the top - EIBI Jan 2017

View from the top


Adding extra value - Oil and gas supplier, Total, is undergoing a transformation that will see it further embrace renewables and energy services. UK customers will soon see the benefits, as Chris Billing explained to EiBI

Original article posted on Jan 2017 Energy in Buildings & Industry publication

   

The pace of change may be significant but many of the world’s major oil and gas giants are making that transition away from fossil fuels to a portfolio where renewables and a whole range of other services are a key part of the mix.

Total, the French oil giant, is making strides to become a more rounded supplier, a move which will have benefits for UK business gas and electricity customers. “As we move forward we are changing,” Chris Billing, director of major business at Total Gas & Power, told EiBI. “Renewables and climate change are now a considerable part of our strategy. We are aiming for 20 per cent of our portfolio as renewables in the next 20 years. Gas, which is the lowest carbon emitting fossil fuel, will be part of the mix going forward as we divest our interests in coal production.”

The move to renewables is part of Total Gas & Power’s vision to see it differentiate itself from other energy suppliers in the UK.

Having joined the company eighteen months ago from npower, Billing posed the question to staff of what the organisation’s unique selling points were. “One was customer service and the other was flexibility, said Billing. “They’re selling points but not unique. Conversations with a financial director today aren’t what they were 10 years ago. Now the questions being asked are ‘how much money can I make from energy?,’ ‘what are the payback periods?,’ and ‘how do I ensure that I’m a low-carbon company?’

“Our ambition is to stand out from the crowd by being the absolute best that we can be for our customers, our employees and for the planet. This has included making difficult decisions. When faced with options, we ensure we are making the right decision for all concerned, both in the short and long term”.

As a result, Total’s product offering for the UK is changing. “Since 2010 we have owned Sunpower, the second biggest solar company in the world,” said Billing. “And last year we acquired Saft, a leading battery company. 

This combination is both powerful and unique. A lot of our competitors talk a good game when it comes to energy services. However these services are often outsourced.”

Batteries are a major talking point. “They are already being used in the aerospace industry,” commented Billing. “And we now have to make it work for buildings. We’re already talking to customers about using solar and batteries which is the easy bit. The next step is how to take those two and combine it with demand side response to maximise your optimisation of electricity.”

Total’s strategy of offering a wider range of services is not limited to solar and battery storage. “Combined with our ambition in renewables is energy efficiency,” added Billing. “Monitoring and understanding companies’ data is of great interest in order for us to offer the best services in the marketplace. We are talking to a number of parties with market-leading products in this space to enable customers to benchmark against other companies in their industry. Offering a broad range of services will be one of the ways Total can fend off competition keen to eat away at its market share. In the industrial and commercial sector Total Gas & Power is the number one gas supplier by volume and ninth place for electricity, according to Cornwall in April 2016, a position Billing says is changing rapidly as their electricity site numbers within Major Business have nearly doubled within the last 12 months.

Transparency is also a part of Total’s commitment to its customers. “This is one area we have concentrated on,” said Billing. “Everything you see on your bill is clear. It’s something we pride ourselves on. And residual products are also not on our agenda. This year we will be challenging organisations using a residual product and asking whether it is the right way forward for them.”

Cost components of the bill are changing and it’s important that customers can understand their price without opaque areas. Staying close to customers is a key reason for Total’s high retention rates. “In 2016, 99 per cent of our direct I&C customers chose to stay within Major Business, that’s compared with 98 per cent in 2015,” said Billing. “I’ve never seen a rate that high and it’s clear that our customers value our relationships with them.”

Billing is also keen to expand Total’s position in the public sector. “We have invested in systems that will allow us to take on larger contracts. We can service thousands of sites and we always ensure that a new customer will receive an excellent service before we contract with them. ”

By investing in energy services customers will find ways of mitigating the rises in energy costs Billing feels are in the pipeline for 2017. “Some analysts suggest that prices could increase between 5 and 10 per cent simply to the change in the exchange rate. Don’t forget that 45-50 per cent of the gas consumed in this country comes from the continent.”

Pressures on prices will be exacerbated this year by non-commodity costs, believes Billing. “People are trying to understand the implication of the capacity market and what it will be like. It looks like it might hit hard, and that’s where we can help business customers with for example, spill contracts and Demand Side Response.”With rising prices and an uncertain market ahead, Total’s strategy of branching out into new markets to offer a wide range of services seems it might pay dividends. “Customer research says that customers want a bill on time, accurate and they want someone at the end of a telephone to deal with a query quickly. Achieving this earns us the right to then start talking about additional services,” Billing concludes.

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Chris Billing

Director - Major Business at Total Gas & Power