NPower and SSE Deal Could Push Energy Bills Up
- Two energy giants are merging
- Could mean less competition for customers
- Energy bills already on the rise
Britain’s competition watchdog has warned that a possible merger between two energy giants, Npower and SSE, could lead to higher prices for households.
The Competition and Markets Authority, said that the deal could reduce competition, and that the two companies need to address its concerns.
Its initial inquiry found the reduction in the number of large players in the UK energy market caused by the merger could impact competition and leave some customers worse off.
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Rachel Merelie, senior director at the CMA, said, “We know that competition in the energy market does not work as well as it might.
“However, competition between energy companies gives them a reason to keep prices down.
“We have found that the proposed merger between SSE Retail and Npower could reduce this competition, and so lead to higher prices for some customers.”
SSE responded saying that it will take its time to asses the CMA’s statement.
Alistair Phillips-Davies, chief executive of SSE, said, “We remain confident that the proposed merger will deliver benefits for customers and for the energy market as a whole, and that we will be able to demonstrate this to the CMA in due course.
“We look forward to continuing to work constructively with the CMA and other interested parties.”
The two energy giants announced in November that their British household energy supply and services businesses would join forces, reducing the Big Six energy suppliers to five.
The CMA had already raised worries over the impact of the deal on the energy market, which is already under pressure amid concerns over unfair tariffs, with a government-enforced price cap set to be introduced on standard variable tariffs later this year.
SSE is Britain’s second biggest energy supplier, and the merged group will serve around 11.5 million customers.
Are you with SSE or Npower? What do you think of the merger? Let us know in the comments.