The Office of Gas and Electricity Markets, OFGEM, has published its draft price proposals for the 14 regional electricity distribution businesses of the Public Electricity Suppliers in the UK. The proposals are for the five years from April 2000, aiming for a reduction in distribution prices for 2000/01 averaging 25-30%, with a further annual reduction of 3% below the rate of inflation until 2004/05. The effect of the proposals on an average domestic bill is complex, but the substantial reductions in distribution charges proposed should have the effect of reducing domestic bills by an average of 5% next year. Distribution costs currently account for around 30% of the final domestic bill. The proposals are due to be finalised at the end of November.
(OFGEM News Release, 12 August 1999)
The National Electricity Consumers Council (NECC) has responded to the Distribution Price Control Proposals, welcoming the Regulator’s commitment to improving the quality of customers’ supply. Incentives on companies to do better and penalties for those companies which do not are welcomed by NECC who agree that companies should not be allowed to underspend on network investment in order to restore current levels of profits. NECC are in favour of the publication of a league table on the Public Electricity Suppliers’ performance which should ensure public pressure on the monopoly businesses to improve customer service.
(OFGEM News Release, 16 September 1999)
