ScottishPower has hit out at the government following the launch of an Ofgem led review of the energy market and comments from Energy Secretary Ed Davey about gas margins.
The energy supplier complained following a letter from Davey in which he suggested energy companies made too much profit from gas sales and that Ofgem should consider breaking up British Gas, the largest energy supplier in the UK.
Head of Iberdrola, ScottishPower’s Spanish parent, Ignacio Galán, said he was “shocked” by Davey’s intervention. Speaking to the Financial Times he said: “It was interference in the work of an independent regulator.”
‘Interference in the work of an independent regulator’
ScottishPower’s Chief Corporate Officer, Keith Anderson, agreed, and told the Telegraph: “One of problems in the UK is we have a regulator for the UK market and we have been seeing more and more political intervention in what the regulator does, and how the industry works out with that regulatory model.”
Anderson added that the review currently being undertaken of the energy sector was unlikely to prove useful, as not only is the market competitive, but Ofgem’s Retail Market Review (RMR) reforms are in the process of being implemented and it is too soon to measure their effect.
Winter price rises add £53 to energy bills
ScottishPower supplies gas and electricity to roughly 4 million UK households and raised its prices by 8.6% in October 2013. This was followed by a 3.3% price cut due to a government led reduction of green levies.
As a result of the winter price rises, the average UK consumer can expect to pay roughly £53 more for energy in 2014.