A full UK competition markets authority investigation into the UK energy market – currently dominated by the Big Six utility suppliers- is ‘almost inevitable’.
That was the key message yesterday in Glasgow at the Power Scotland Conference from Tom Greatrex, MP, Labour’s shadow energy minister.
He told an audience of Industry and Power Association conference delegates that he was “almost sure that … (we will) get a full competition inquiry into the UK energy market,” and that “the Big Six players have indicated they will take part in such an inquiry”.
The shadow minister’s comments were made in the context of the Labour party’s Green / consultation Paper on UK electricity market regulation, “EMR – the power of Britain’ and Greatrex added;
“The Energy Market Review (EMR) highlights the fundamental need for public acceptability of the requirement for acceptance of the renewables sector. It is going to cost more – there is no doubt about that.
“But along with security of supply issues, low- and de-carbonisation of the electricity supply sector and the growth of renewable energy – all of which need encouragement – the need to establish transparency, clarity and fairness in EMR is equally paramount.
“There is no silver bullet to solve all the problems of a dysfunctional electricity supply market – some of which have led to a consumer ‘crisis of confidence’ in fuel prices.
“Transparency is required so that consumers know what they are paying for – and why – which is why the Labour party is addressing these issues now. Issues about the cost of some renewables technologies also need to be made transparent.
“We also need a transparent interpretation of the Big Six suppliers, who need to be properly calibrated over their own tariffs and also to allow comparison between suppliers and we remain committed to Contracts for Difference (CfDs) to bring about cost of capital transparency, which will have long-term benefits for consumers.
“We also consider it important for the Green Investment Bank (GIB) to maximise the current opportunities of low interest-rates and high investment needs by taking a more active role – now rather than later – and we remain committed to the direction of travel for EU renewables targets.”
Greatrex also made a number of party-political points about pros and cons of the prospective UK constitutional change contingent upon the outcome of the Scottish Independence Referendum, due to be held on 18 September this year.
He echoed a comment made last week in Edinburgh by Ed Davey, UK Energy Secretary, that Scotland could not afford on its own to subsidise investments in renewable energy projects and that Scotland could only do so if it was able to ‘rely on’ continued subsidy from the Rest of the UK.
(See Scotland is ‘world energy hub – but could not afford renewable subsidies as an independent nation’ says UK Energy Minister – Scottish Energy News 19 March 2014)