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CMA Investigation Initial Statement

CMACompetition and Markets Authority

Whilst being mindful not to prejudge the outcome, Roger Witcomb, chairman of a five-strong panel of competition experts appointed by the CMA to investigate the energy market has laid bare the fundamental concerns that exist about the current UK energy market.

Whilst cautioning that they were “topics for investigation and are not views, let alone findings or conclusions”, Witcomb said:

“This is a market which is very complex so it is important at an early stage to focus the investigation on the most relevant issues”

In a damning statement, Witcomb highlighted that:

“Aspects of the behaviour of the six largest suppliers would appear to be consistent with tacit co-ordination between them, including the announcement of price changes around the same time and of a similar magnitude and convergence of domestic supply margins”

In addition Witcomb announced that the investigation would focus on:

  • Barriers to entry to new entrant suppliers
  • The impact of vertical integration on the energy market
  • Opaque pricing and liquidity as features of the wholesale market

Alongside Witcomb in the CMA panel are heavyweight competition lawyers Lesley Ainsworth and Malcolm Nicholson, economist and government policy review veteran Martin Cave, and Bob Spedding, a chartered accountant and former head of advisory risk at KPMG.

So it’s good to know that focussed, experienced and rational heavyweights are running this crucial investigation.

Sadly the same can’t be said of the opposition with Ed Miliband perhaps being the first person to detail his party’s energy policy in 140 characters when tweeting that the publication of the CMA’s statement was:

“More evidence that we need to freeze energy prices and reform our broken energy market

Let’s hope for more considered, rational and intelligent a response from the CMA.

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