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CMA to deliver verdict on energy market investigation

CMA logoThe Competition and Markets Authority will announce the provisional findings of its energy market investigation today. The full and final report however is not expected until the end of the year.

Initial findings show that despite popular opinion, the big 6 will not be dismantled. It was claimed that the larger firms were in collusion to drive up prices and monopolise the UK energy market. The CMA deny this and have even suggested that there not be a cap placed on the number of tariffs that suppliers can offer.

Great news for the big six but the CMA are also recommending new initiatives for switching to cheaper providers. It seems they feel that customers need to jump on the bandwagon and help themselves to save money.

They are therefore working on incentives to make it easier for “sticky” customers to move to independent suppliers offering cheaper deals.

Smaller energy suppliers had previously been hindered by a growing number of industry codes, which the CMA will now be revising.

Juliet Davenport, chief executive of independent supplier Good Energy, said she would be delighted to see the CMA cutting red tape because it was hankering innovation. She explained:

“We want to see more people actively participating in the energy markets, from changing their usage patterns of energy through to generating their own power, and the way the market is set up at the moment just means those kinds of innovations are impossible.”

It seems the CMA have got it right this time. Perhaps we should thank Miliband for his scrutiny on the energy market, however misplaced his price freeze idea may have been.

Customers will hopefully become more aware of energy savings to be made, and start getting better deals.

Mark Todd, director of price comparison site, said there was plenty of evidence that retail customers were still not getting the deals they deserved.

“Wholesale prices have been falling for months and we are now at a five-year low. It’s now more apparent than ever that energy firms should pass on the savings that customers deserve. The cuts made to domestic tariffs earlier this year were paltry at just 2.5% and short-changed most customers, who are rightly angry.”

We just need to curb this kind of press now.

Mr Todd, please understand that wholesale prices only make up 35% of the total energy bill costs. So try focusing your negativity at the levies the government put in place rather than at our suppliers. For the real facts, read our article on why isn’t my energy bill falling.