Anaylsis In To Uk Utilities Sector

2420 words - 10 pages

CONTENTS PAGE NO1.0 Introduction . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 32.0 PESTEL Analysis of Utilities . . . . . . . . . . . . . . . .2.1 Political issues . . . . . . . . . . . . . . . . . . . . . . .2.2 Economic Issues . . . . . . . . . . . . . . . . . . . . . . . .2.3 Sociological Issues . . . . . . . . . . . . . . . . . . . . . . . .2.4 Technological Issues . . . . . . . . . . . . . . . . . . . . . .2.5 Environmental Issues . . . . . . . . . . . . . . . . . . . . . .2.6 Legal Issues . . . . . . . . . . . . . . . . . . . . . . . . . . . .3.0 Technological Impacts on Utilities3.1 Out Sourcing IT . . . . . . . . . . . . . . . . . . . . . .3.2 Use of E-Business . . . . . . . . . . . . . . . . . . . . ..4.0 Bibliography . . . . . . . . . . . . . . . . . . . . . . . . . . . .1.0 IntroductionThe United Kingdom's Utilities industry is ever growing and changing. It consists of three main industries which form the basic needs of nearly every household in the country; these being Water, Electricity and Gas. Since the 90's all of these industries have been Privatised and so with that there is now ever growing competition between rival companies to offer a better service and value to consumers; their main aim being profit as a result of this. This report sets out to conduct an analysis of these utilities and explain the various factors which affect the behaviour in which these utilities operate and perform. The two main factors that will be looked at will be a Pestel analysis of the entire utilities industry followed by an analysis of the likely impacts of technology.2.0 PESTEL Analysis of UK Utilities IndustryThe PESTEL analysis will look at the different factors affecting the Utilities industry. These factors include Political, Economic, Sociological, Technological, Environmental and Legal.2.1 Political IssuesPolitical issues affecting the Utilities Industry may include the fact that many of these industries were privatised but the government kept 'Golden Shares' in certain industries, including the national grid. However in May 2003 the European Court of Justice ruled that the shares held by the government were illegal and hence, this opens up new possibilities as certain restrictions enforced by the government may no longer apply. "The reason for the golden share arrangement originally was to protect these companies from takeover and maintain a degree of government control over the companies. However, the European Court has ruled that these restrictions on ownership are illegal because they are a restriction on the free movement of capital which is one of the fundamental tenets of the single market within Europe "(Bized.ac.uk, 2003 Internet). The utilities have always had to be watchful of the government because issues that may affect public interest will be scrutinised by government watchdogs such as OFGEM who have been granted powers by the government to punish companies. An example of this is OFGEM's proposal of fines for...

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