Who will shed a tear for Npower?

But the dream was soon to turn sour.

Npower was later to become synonymous with poor customer service – consistently coming bottom of the league tables.
Little surprise, then, when a proposed tie-up with SSE’s retail arm became the only game in town.

News that the Competitions and Markets Authority (CMA) has now given a provisional blessing to the merger suggests strongly that the biggest shake-up of the energy sector in years will go ahead. Given the thrust of the CMA’s first stage report, it is hard to see a change of tack when it delivers its final verdict in October.

So, what could this mean for the rest of the market? Could we be seeing more movement soon?

Well, given that the competition watchdog concluded last week that the blossoming of start-up firms over the past five years should be sufficient to rein in energy prices, it is undoubtedly plausible. There is little in the CMA’s conclusions that would preclude further merger activity in energy retailing.

Even Citizens Advice, which speaks up for the more vulnerable end of the consumer spectrum, doesn’t seem too perturbed about the potential tie-up.

Yet, none of what we will we soon be calling the “big five” look to be in as weak a position as Npower did in the run-up to last year’s announcement, so have less incentive to consolidate.

Meanwhile the introduction of the cap on standard variable tariffs will inevitably reduce the scope for companies to undercut one another on their default prices.

That said, the CMA’s conclusions will be of interest in the boardroom of Eon’s German parent company as it continues to shuffle its pack of energy businesses.

And of course some smaller suppliers – albeit at the more intensely competitive end of the market – are already looking at selling up to cash in on recent growth in customer numbers.

The CMA’s report is an amber light for further consolidation in the energy retail market.