UK energy suppliers caught swimming naked
Gas price spike reveals parlous state of UK’s deregulated energy retail market
The chickens are coming home to roost in Westminster. A surge in global gas prices is revealing the parlous state of the UK’s deregulated energy retail market. Independent suppliers are dropping like flies and the decade-long mantra of ‘competition is good for consumers’ is being thrown out of the window. Energy Flux examines the political and regulatory shortcomings that sowed the seeds of today’s epic market failure.
The UK government spent the last decade encouraging nimble new entrants to compete with the UK’s ‘Big Six’ incumbent integrated energy retailers. These exciting digital natives, unencumbered by ageing power generation assets or armies of sales executives, were congratulated for spurring innovation, improving market efficiency and lowering prices.
Now, as the UK wholesale market explodes in the face of a global energy crunch, ministers are accusing those same heroes of liberalisation of being “badly run”. These tiddlers won’t be bailed out.