New powers to stop energy anticompetitiveness proposed
Chris Huhne wants to strip the big six energy companies of their ability to impede action by regulator Ofgem under new plans Fresh powers to compensate consumers if they are the victims of anticompetitve practices by the big six energy companies will be proposed on Tuesday by the energy secretary Chris Huhne. Huhne is planning for energy companies to be stripped of their current ability to impede action by the regulator Ofgem by forcing it to seek a second opinion from the Competition Commission. Instead, Ofgem will have powers to impose its decisions and energy companies will have a right of appeal. Huhne is looking at giving Ofgem new powers to require energy companies to provide direct redress when consumers have lost out as a result of a company breaching a licence condition. The big six firms are EDF energy, British Gas, EON, Npower, Scottish and Southern Energy and Scottish Power. At present, Ofgem has powers to fine companies up to 10% of their annual turnover, which goes to the Treasury, But Huhne is to propose that the money could go direct to customers, either as compensation or in lower bills. He will also ask whether Ofgem should be given powers to prevent the big six freezing out new firms by offering excessively cheap online deals, making it hard for small firms to enter at a competitive rate. He will say it is not fair that energy companies can push their prices up for the vast majority of their consumers who do not switch while introducing cut throat offers for new customers that stop small firms entering the market: “That looks to me like predatory pricing. It must and will stop.” At the weekend Huhne was reported as describing consumers lazy for failing to shop around for cheaper energy. He will explain he did not regard consumers as indolent, but he will argue the average household could save £200 by switching to the lowest cost supplier. Consumers, he will explain, “still think that they face the same bill whoever they go to”. He is making it easier for consumers to change energy supplier so in future they will have a right to be switched within three weeks once a cooling-off period has elapsed. He is also to set up a working group on collective purchasing and switching in energy with Ofgem Consumer Focus and Whitehall to examine the potential for collective purchasing and switching in the energy market, and to review any barriers preventing consumers from coming together. EDF Energy was the last of the big six to raise prices last week increasing gas prices by 15.4% and electricity prices by 4.5% from 10 November. The firm said it had absorbed wholesale price rises for as long as possible before being forced to raise costs for customers. Energy industry Utilities Chris Huhne EDF Energy Scottish and Southern Energy Family finances Energy bills Household bills Patrick Wintour guardian.co.uk
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New powers to stop energy anticompetitiveness proposed
Chris Huhne wants to strip the big six energy companies of their ability to impede action by regulator Ofgem under new plans Fresh powers to compensate consumers if they are the victims of anticompetitve practices by the big six energy companies will be proposed on Tuesday by the energy secretary Chris Huhne. Huhne is planning for energy companies to be stripped of their current ability to impede action by the regulator Ofgem by forcing it to seek a second opinion from the Competition Commission. Instead, Ofgem will have powers to impose its decisions and energy companies will have a right of appeal. Huhne is looking at giving Ofgem new powers to require energy companies to provide direct redress when consumers have lost out as a result of a company breaching a licence condition. The big six firms are EDF energy, British Gas, EON, Npower, Scottish and Southern Energy and Scottish Power. At present, Ofgem has powers to fine companies up to 10% of their annual turnover, which goes to the Treasury, But Huhne is to propose that the money could go direct to customers, either as compensation or in lower bills. He will also ask whether Ofgem should be given powers to prevent the big six freezing out new firms by offering excessively cheap online deals, making it hard for small firms to enter at a competitive rate. He will say it is not fair that energy companies can push their prices up for the vast majority of their consumers who do not switch while introducing cut throat offers for new customers that stop small firms entering the market: “That looks to me like predatory pricing. It must and will stop.” At the weekend Huhne was reported as describing consumers lazy for failing to shop around for cheaper energy. He will explain he did not regard consumers as indolent, but he will argue the average household could save £200 by switching to the lowest cost supplier. Consumers, he will explain, “still think that they face the same bill whoever they go to”. He is making it easier for consumers to change energy supplier so in future they will have a right to be switched within three weeks once a cooling-off period has elapsed. He is also to set up a working group on collective purchasing and switching in energy with Ofgem Consumer Focus and Whitehall to examine the potential for collective purchasing and switching in the energy market, and to review any barriers preventing consumers from coming together. EDF Energy was the last of the big six to raise prices last week increasing gas prices by 15.4% and electricity prices by 4.5% from 10 November. The firm said it had absorbed wholesale price rises for as long as possible before being forced to raise costs for customers. Energy industry Utilities Chris Huhne EDF Energy Scottish and Southern Energy Family finances Energy bills Household bills Patrick Wintour guardian.co.uk
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on September 20, 2011. Filed under News, Politics, World News.
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