Tuesday, 19 August 2014

former regulators say the industry is Over Regulated

Five former energy regulators have suggested that too much regulation may have hindered competition among energy suppliers, maintaining high prices.

They suggest that since 2008 regulation has been too aggressive.

The former regulators include Stephen Littlechild, head of electricity regulation from 1989 to 1998, and Sir Callum McCarthy, head of the current regulator Ofgem from 1998 to 2003.
Their arguments are set out in evidence to a recent competition enquiry.

In July the CMA (Competition and markets Authority) launched a full scale enquiry into the working of the energy industry at the request of Ofgem, amid widespread and long standing concern that gas and electricity suppliers are able to keep on raising prices, free of any real competitive pressure, even when wholesale prices have been falling.

The former regulators, who also include Clare Spottiswoode, head of gas regulation from 1993 to 1998, say that Ofgem's own interventions in the way the industry is run have imposed extra costs on it, and have also forced energy suppliers to eliminate some cheaper tariffs.

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