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UK energy minister says small firms should supply 30 percent of market by 2020

Published 15/12/2014, 01:00
© Reuters. Britain's Secretary of State for Energy and Climate Change Davey speaks speaks during the Liberal Democrats annual conference in Brighton
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LONDON (Reuters) - Britain's Energy Secretary Ed Davey said on Monday he wants the market share of independent energy providers to treble by the end of the decade, as the competition watchdog looks into the competitive behaviour of major utilities.

Independent energy suppliers' market share has doubled this year to nearly 10 percent as energy users move away from the incumbent 'Big Six' providers in protest against poor customer service and high bills.

"I want to go further and see them have a 30 percent market share by the end of the decade," Davey said in a statement. He did not say how this target would be achieved, and the energy ministry press office said the statement reflected the minister's personal view.

The government does not have an official target to increase the market share of independent energy suppliers. But the competition watchdog is currently carrying out an in-depth investigation into whether the Big Six have displayed any anti-competitive behaviour, a probe that could lead to the break up of some companies.

The Big Six are SSE, Centrica's British Gas, Scottish Power, E.ON, RWE npower and EDF Energy.

The affordability of energy bills rose to the top of the political agenda a year ago when the opposition Labour party promised to freeze energy prices if it wins power in next May's election.

Market share data compiled by consultancy Cornwall Energy showed on Monday that small suppliers now hold 8.7 percent of domestic energy accounts or 10.4 percent when comparing the share of dual-fuel accounts.

"Smaller suppliers are now a significant threat and credible alternative to the major suppliers," said Nigel Cornwall, managing director of Cornwall Energy.

© Reuters. Britain's Secretary of State for Energy and Climate Change Davey speaks speaks during the Liberal Democrats annual conference in Brighton

First Utility is the largest of Britain's independent suppliers, holding 3.1 percent of the dual-fuel market, while others including Ovo Energy and Utility Warehouse, owned by Telecom Plus, make up the rest.

(Reporting by Karolin Schaps; Editing by Michael Urquhart)

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