A new report from Ofgem has called for reforms in the electricity connections market to help reduce delays for customers that find it difficult to get connected to the electricity grid.
Ofgem has carried out a six-month review to investigate the energy connections markets to examine just how competitive it currently is, and to understand the barriers that are preventing better competition.
In the report, Ofgem has detailed the changes that all local distribution network companies must carry out within the next six months in order to adequately improve competitiveness.
Strong competition in connections market
The review by Ofgem showed that competition in the electricity connections market was growing strongly, however, there are areas of competition that have been slow to gather speed. Ofgem asserts that stronger competition would lead to lower prices, better services for customers and better innovations.
As things currently stand, the network company is the only provider for many parts of the connections process. However, under the new reforms, independent companies would be allowed to step in to help decide connection points and speed up the process. Ofgem says that these measures would “level the playing field by reducing their reliance on the local electricity network companies”.
Commenting on the proposed changes, Maxine Frerk, Ofgem’s senior partner, distribution, said:
“We are requiring electricity network companies to work quickly to resolve the issues identified in the connections market, to reduce the hassle of getting connected to the grid and help lower costs for customers.
“We are determined to ensure this part of the energy market works in customers’ interest and will use the full range of our powers to do so.”
During its review, Ofgem also found that one energy company could be in breach of the current competition laws. The Competition and Markets Authority have been advised of this possible breach and an investigation is to be launched as to whether the energy company acted in a way that put its competitors at a disadvantage in the energy connections market.
Following the review, people will now be invited to take part in a consultation process so they can give their opinions regarding the proposed reforms of the energy connections market.
The consultation will come to an end on 18, March, 2015 and the new regulations are likely to come into force at the end of September.