Industry voices have reacted with concern after the anticipated merger between big six suppliers SSE and Npower was called off.

The two suppliers made the announcement yesterday (17 December) and cited “adverse developments” in the retail market as well as “regulatory interventions” such as the price cap.

The GMB energy union said it was demanding reassurances for its members.

Keir Howe, GMB organiser, said: “We are very concerned about what the future holds for our Npower members and we are demanding assurances from the company.

“GMB members had already expressed how worried they are about their job security and this news has only made the situation worse.

“We have called on Npower bosses to meet with us as a matter of urgency to give our members clarity on what the future holds.”

Npower declined to comment about whether it will hold a meeting with the union.

The chief executive of Citizens Advice has warned that customers’ interests should remain the focus of both SSE and Npower.

Gillian Guy said: “It’s vital that energy suppliers hold their customer’s interests at the heart of their decision making and keep their focus on providing good customer service and value for money.

“As SSE and Npower now move forward with alternative plans for their retail businesses, it’s essential that any new arrangements deliver real benefits for their customers.”

Matthew Vickers, chief executive and chief ombudsman at the Energy Ombudsman, added: “The pace of change in the energy market is faster than ever and the competitive pressure is intense.

“It’s essential that customers are treated fairly and can rely on the services they buy.

“We’re ready to help all suppliers to build strong relationships with customers based on trust, whether they have ten thousand or ten million customers.”

Meanwhile Sally Jacques, head of energy at auto-switching service Weflip, said the real problem for both companies could be the fact that customers are switching away.

She said: “While SSE is pointing to the energy price cap as the reason for pulling out of its merger with Npower, the real problem for both these companies could be the fact customers are switching away, in search of better deals.

“While there may have been some savings passed down from the two combining forces, the reality is customers are going to go where the best deals are, and with the gap between the big six standard variable tariffs compared to the best buys still large, it couldn’t have been guaranteed their customer numbers would have grown as a result of this merger.”

The two companies had been in discussions to negotiate the terms of the deal since last month but were unable to reach an agreement.

Martin Herrmann, chief operating officer retail of Innogy SE, said: “Adverse developments in the UK retail market and regulatory interventions such as the price cap have had a significant impact on the outlook for the planned retail company.

“We negotiated intensively with SSE on adjustments to the transaction as announced in November 2017. Unfortunately, we could not reach an agreement that was acceptable for both sides. We are now assessing the different options for our British retail business.”

Alistair Phillips-Davies, chief executive of SSE plc, added: “This was a complex transaction with many moving parts. We closely monitored the impact of all developments and continually reviewed whether this remained the right deal to do for our customers, our employees and our shareholders.

“Ultimately, we have now concluded that it is not.

“This was not an easy decision to make, but we believe it is the right one.”

SSE has confirmed it is in discussions with the designated board members for the new energy retail company.

Katie Bickerstaffe was named as chief executive designate for the new company back in April and took up the role on 24 September.

“Appropriate arrangements” were agreed at the time of her appointment to compensate her in the event of the transaction not going ahead.

Under the terms of her appointment, she was due to receive a basic annual salary of £650,000, as well as health insurance for her and her spouse and dependent children and a car allowance of £15,000 per annum.

What to read next