Vincent de Rivaz, head of EDF, criticised Labour’s proposals for the energy industry and said: “[Energy bill] increases have not, I repeat, been driven by higher margins.”
He explained that half the reason bills have rocketed is down to growing wholesale prices. Other reasons include higher distribution costs, which he blamed for a quarter of rises, and government levies and taxes, which he said were responsible for the final quarter.
De Rivaz refused to be drawn into a debate around Labour leader Ed Miliband’s highly publicised energy price freeze promise.
Large scale players have ‘view across the whole system’
Speaking at last month’s Labour conference, Energy Secretary Caroline Flint said that splitting energy generation from home supply would reduce bills. The reasoning behind this claim is that if a company owns both the supply and generation side of the business, there is no incentive to reduce costs.
De Rivaz disagreed with this argument and said: “It is vital to have large-scale players who can take a view across the whole system to help design it and to operate it with a view to the final customer outcome. In our case, no one else in the UK has such a diverse generation portfolio. Nuclear, coal, gas, renewable.
“That gives us a unique perspective. It means that I can say with greater confidence than most that a world without companies working on both generation and customers is a fragmented world. Where each of the market players fights his corner with no one caring if the whole will add up for customers.”
Single-unit price for energy
In response to claims that the energy market is uncompetitive, De Rivaz has called for the new Competition and Markets Authority to investigate the industry for any wrong doings.
He also spoke in favour of a single-unit price for gas and electricity, a move which he believes would bring greater transparency to the industry and enable consumers to accurately compare prices.
“We are ready to discuss the detailed implementation of this proposal with the regulator who has a vital role to play,” he said.