SSE in ‘legally binding’ commitments to Ofgem

Gas and electricity regulator Ofgem said it accepted legally binding commitments from Perth-based energy giant SSE following a Competition Act investigation into whether SSE’s behaviour could have impeded competition for connecting new developments to its electricity network in the South of England.

“Ofgem’s investigation did identify competition concerns regarding SSE’s behaviour in providing services needed for competitors to connect new developments to its electricity distribution network in the South of England,” said Ofgem.

“These included inconsistencies in providing essential services needed to allow competitors to compete effectively, including inconsistency in quotes. ”

Ofgem said hundreds of thousands of connections are made every year as new housing estates and business premises connect to electricity distribution networks.

It said the market for providing these electricity connections is worth more than £500 million a year in Great Britain as independent companies compete against regional distribution network operators like SSE to connect new customers.

Ofgem said SSE has committed to:

  • splitting operations within SSE’s connections business to separate the team that provides essential services to the connections market from the team that competes in the connections market
  • putting in place an improved IT system to prevent inconsistent quotes from being issued for the same site without justification
  • mandatory and regular competition law compliance training
  • frequent, independent, third party auditing of and reporting on SSE’s compliance with the commitments

Ofgem said its considers that these commitments will fully address the competition concerns that have been identified.

Ofgem concluded: “As a result of accepting the commitments, Ofgem is closing its investigation with no decision made on whether or not SSE infringed competition law.”