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Introduction
 
When NETA was introduced into England and Wales, Scotland was left with an arrangement little changed from the 1990s. As there was no traded wholesale market, energy producers were required to sell their output to ScottishPower and Scottish and Southern Energy at a price set by the regulator. Thus the two Scottish based utilities controlled almost the entire generation output of Scotland.
 

 
Scope
 
An explanation of the background to BETTA and its key features.
 
An evaluation of contradictory arguments about the affect that BETTA will have on energy retail in Scotland.
 
Prediction of the wins and losses for each major utility in the I&C market.
 
Highlights
 
The relative sizes of transmission and distribution charges may go some way to explaining the lack of residential switching in Scotland, but this is in no way conclusive.
 

 
Datamonitor expects the market share in Scotland's I&C sector to become more like the one in England and Wales. If the Scottish I&C sector becomes like England and Wales ScottishPower will lose market share dramatically, principally to EDF Energy, British Energy and RWE npower.
 

 
Reasons to Purchase
 
Understand what BETTA means to the retail department.
 
Gauge how much market share the Scottish incumbents are likely to lose

TABLE OF CONTENTS
 
EXECUTIVE SUMMARY 3
 
BETTA will affect the Scottish I&C retail market, particularly to EDF Energy’s benefit and ScottishPower’s detriment 3
 
BETTA EEV 7
 
Before BETTA, the Scottish wholesale power market was controlled by SSE and ScottishPower but prices were set by Ofgem 7
 
BETTA involves the introduction of a traded wholesale market and fundamental changes to power transmission management 8
 
There are cogent arguments both for and against the proposition that BETTA will change the retail landscape in Scotland 9
 
The retail market will change 9
 
The retail market will not change 9
 
The prevalence of the Scottish suppliers in Scotland’s I&C sector suggests that the retail market was not competitive 10
 
Explanations based on brand and location do not explain the lack of switching in the I&C market 11
 
Datamonitor concludes that TUOS / DUOS charges do not account for the lack of switching in Scotland 12
 
Datamonitor expects the market share in Scotland’s I&C sector to become more like the one in England and Wales 13
 
If the Scottish I&C sector becomes like England and Wales ScottishPower will lose market share dramatically, principally to EDF Energy, British Energy and RWE npower 15
 
Neither Scottish supplier is in a strong position in the I&C market, although ScottishPower seems likely to suffer most 17
 
The non-Scottish based suppliers bring several advantages to Scotland, but the SME market will still not be easy to crack 18
 
APPENDIX 19
 
Research methodology 19
 
Future readings 19
 
Report writing team 19
 
How to contact experts in your industry 20
 

 

 

 
LIST OF FIGURES
 
Figure 1: I&C retail load in Scotland (2003/04) 11
 
Figure 2: Cost components of an I&C bill 13
 
Figure 3: Percentage of total volume in E&W (2005) 14
 
Figure 4: I&C volume in Scotland if the market grows to resemble E&W 15
 
Figure 5: Net change in I&C volume in Scotland if the market grows to resemble E&W 16
 
Figure 6: ScottishPower is likely to suffer most 17
 
Figure 7: The non-Scottish based supplier bring several advantages to Scotland 18