National Grid takes Ofgem to the competition watchdog over energy earnings plan and Symbio Energy bites back at the regulator

What’s happening?

Rebellion

National Grid has said it will refer parts of Ofgem’s plans to the CMA because they do not allow large enough returns for its investment into the UK’s electrical cables and gas pipes.

The rebellion is growing as Scottish Power and SSE also announced that they would be appealing against Ofgem’s plans. Gas network operators too are set to join the growing unrest with SGN, Cadent and Northern Gas networks also likely to get involved.

“Ofgem has ultimately ignored certain evidence presented by the industry in its consultation and has underestimated the financial risk of its major infrastructure investments by setting returns that are too low,” said John Pettigrew, the chief executive of National Grid.

Akshay Kaul, Ofgem’s networks boss, said the regulation “drives a fair price for consumers, improves services and boosts green energy investment”.

“We respect the Competition and Markets Authority appeal process, where we will defend robustly our decisions which are in the best interests of consumers and tackling climate change,” he said.

“While the appeals could take around six months to resolve, they will not delay any investment and we look forward to working closely with industry to accelerate investment for a green recovery.”

Update 05/03/2021 - Nine firms are seeking permission from the CMA to appeal against Ofgem’s price controls for energy companies. The 9 firms seeking permission to appeal this price control are:

• Cadent Gas Limited
• National Grid Electricity Transmission plc
• National Grid Gas plc
• Northern Gas Networks Limited
• Southern Gas Networks plc and Scotland Gas Networks plc (joint application)
• Scottish Hydro Electric Transmission plc
• SP Transmission plc
• Wales & West Utilities Limited

Also read: 18 Energy Suppliers told to refund a million energy consumers by Ofgem

Symbio Energy accuses Ofgem of abusing its powers

Challenger energy supplier Symbio Energy has lashed out at Ofgem after the energy regulator threatened to fine the company £100,000 over late renewable energy scheme payments.

The company lashed out by releasing a press release earlier this week accusing Ofgem of abusing its powers as well as making claims that it is ‘institutionally racist’.

In a statement Symbio complains; “In March 2020, as per the Ofgem guidelines, with the advent of the global pandemic in March 2020, the Secretary of State for Business and Energy acknowledged the situation. They released a statement supporting the UK citizens going through financial difficulties and assured that the government would continue to supply energy during these difficult times.

‘Hence energy companies were advised not to chase the customers who could not pay for the electricity they consumed. It is logical and entirely appropriate that similar grace should be afforded to energy suppliers in their payments. Instead, in breach of their mandate as a regulator, they chose to penalise Symbio.

‘Under the Freedom of Information (FOI) Act 2000, Symbio Energy had requested information detailing senior management appointments within Ofgem from the BAME & LGBTQ+ communities. Upon contact, Ofgem informed Symbio Energy that due to Commercial or Industrial Information Confidentiality, they do not hold such information and cannot provide the same. As per FOI, only two people from the LGBTQ+ community have ever held senior positions at Ofgem in the past twenty years. Is this something they should be proud of?”

The full press release can be read here.

Also read: Ofgem opens investigation into Symbio Energy over late Renewables Obligation and Feed-in Tariff payments

Dyball Associates will keep you informed of the latest changes and our team of energy market consultants can guide you through the steps to enter the UK energy market. Whether you’re looking for electricity and gas systems or support on starting an energy supply company, Dyball Associates can help.

Further Reading

How can smaller energy suppliers be competitive?

Energy Suppliers call for changes to electricity and gas levies

Cyber attack forces Npower to permanently withdraw its mobile app

Dyball Associates are proud to help new supply businesses successfully launch in the UK market.

Through our energy market consultancy services, and the software we've developed, we're supporting new UK electricity and gas suppliers get set up and start supplying.

Follow us on LinkedIn to keep up to date with the latest news and updates in the energy industry.