Speaking at Utility Week Live in Birmingham today (Tuesday May 17), Nolan said: “If the industry doesn’t deliver on the CMA remedies, if it doesn’t get competition back on track, in my view plans to regulate electricity and gas prices more widely may go back on the table.”
He said the industry needs to accept all the CMA’s recommendations, which include the creation of a database of disengaged customers and a temporary ‘safeguard tariff’ for customers on pre-payment meters. Referring to rumours that some suppliers are considering legal challenges against individual remedies such as the safeguard tariff, Nolan said: “I don’t believe it can be regarded as a regulatory ‘pick and mix’”. It’s time to finalise the details of how best to implement the remedies and make them work.”
The CMA published its provisional remedies for the energy sector in March, following a two-year investigation. Its final recommendations are due to be published next month.
Speaking at the same session, Ofwat chief executive Cathryn Ross emphasised the water regulator’s focus on creating markets, across the wholesale value chain as well as retail, saying; “Ofwat is becoming a pro-market regulator.”
Ross highlighted Ofwat’s plans to create markets for water trading, sludge and major infrastructure projects such as the Thames Tideway. These plans were set out last year in Ofwat’s Water 2020 discussion paper. A decision document will be published next week.