Responding to the Competition and Markets Authority (CMA) investigation into the UK energy market which found that households and small businesses have been overcharged, the Institute of Directors said that bigger questions clearly have to be asked about how energy markets are regulated in the UK.
Dan Lewis, Senior Infrastructure Adviser at the Institute of Directors said:“It is good to see the CMA suggest some simple, market-led solutions to the problem of over-charging.
“These include encouraging companies to alert consumers when their fixed contract ends, send reminders to customers to check their meters, and keep them much better informed of new tariffs and cheaper alternatives. These are simple and cheap remedies which could be effective in promoting more widespread behavioural change.
“The Big Six must act on them if we are to avoid the prospect of more heavy-handed intervention in the energy market.
“And the government would be well advised to face up to the costs of its own policies in driving up energy bills.
“The £12 billion Smart Meter programme, which will increase household bills even further, should be reviewed as a matter of urgency.
“As the CMA highlighted, environmental and social policies along with network costs have contributed to higher prices, it is therefore discouraging not to see the CMA take a more critical line against Smart Meters.”
“Both the Energy and Climate Change Committee and now the CMA have criticised the regulator, Ofgem, claiming it has not done a good enough job to keep network costs in check. It will be interesting to see if this leads to the emergence of a more creative, critical and competitive tension between the regulators, as they cast an eye over each other’s work.”
Competition Authority calls for energy market reform as confusion, complexity, lack of trust and inertia cost households an extra £160 a year on utility bills – http://goo.gl/lzqC2U