Competition Commission Rejection of Market Abuse
Licence Condition – EIUG’s Reaction


The Energy Intensive Users Group (EIUG) is very disappointed with the Competition Commission’s decision. EIUG is concerned about the implications this has for the ability of the regulator act against further market abuse in a timely and efficient way.The new electricity trading arrangements (NETA) will solve many of the problems associated with the current pool. However, these complex and as yet untried new trading arrangements may also present gaming opportunities for generators.

There has been ample evidence of market abuse under the current pool system. Industrial consumers are also acutely aware of recent lessons from the gas market.Wholesale gas prices have doubled this year and many suspect market manipulation – coupled with limited regulatory powers – may be to blame. Rising gas prices also make it less easy for new gas-fired generation to enter the market, which makes the Competition Commission’s faith in increased competition seem naïve.

Jeremy Nicholson, EIUG’s economic adviser, says: “We think this is a step in the wrong direction. Customers must have confidence that Ofgem has the power it needs to do its job. This decision does nothing to protect customers.”

Notes to editors:

  1. EIUG gave evidence earlier this year to the Competition Commission in support of Ofgem’s position on the market abuse licence condition for generators.
  2. For further information please contact Jeremy Nicholson on 020 7343 3159, or 07785 280 568 (mobile).