UK power regulator supports government energy review

14 Feb 2002 – The UK energy review delivered today by the governments Policy and Innovations Unit has been welcomed by Callum McCarthy, Chief Executive of Ofgem – UK electricity and gas regulator.

Commenting on the publication he said he supported the PIU’s recommendation that competition should be the cornerstone of future energy policy and the prospect of a wider debate on future environmental policy.

“We also welcome the PIU’s recognition of the success of competitive gas and electricity markets in contributing to a secure, diverse and keenly priced energy supply for British customers,” said McCarthy.

Ofgem welcomed the prospect of a wider debate on Britain’s environmental objectives and policies and the recognition that future energy policy must be developed within an international context.

“Everyone agrees that environmental targets should be met at the lowest cost to consumers – that is the best way to meet the needs of the fuel poor, safeguard competitiveness, and enable Britain to meet its international environmental targets,” said McCarthy. “We need to improve our understanding of the implications of environmental targets and how best to meet these. Ofgem is committed to working constructively with Government and others to achieve this.

The PIU report makes a number of recommendations about the development of the Neta market and its effect on renewable and CHP generation. Neta, which replaced the former Electricity Pool almost year ago, created, for the first time in Britain, an open market for the sale and purchase of wholesale electricity.

Commenting on the position of renewable and CHP generators under Neta, Callum McCarthy added, “Ofgem is committed to using its powers to help smaller generators operate more efficiently in the new market and progress has already been made on this. Above all, Ofgem is committed to ensuring that Neta operates fairly for all types of generation.”

Ofgem said it would be participating fully in the public debate and Government consultation which will follow today’s publication, and will publish a fuller statement in due course in response to the PIU’s recommendations.

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