Green light to energy goliath

But concerns about prices and jobs remain

WATCHDOGS yesterday cleared a mega-merger between two of Britain’s biggest energy suppliers – despite fears of higher bills.

The Competition and Markets Authority backtracked on initial concerns by giving SSE and Npower’s tie-up a provisional green light.

The coming together of SSE, the UK’s second biggest supplier, and Npower will create a new industry goliath with 11.5 million customers, leapfrogging British Gas.

The CMA reckons customers have “plenty of choice”, given there are now more than 70 competing suppliers.

But the so-called Big Six – British Gas, SSE, Npower, ScottishPower, EDF Energy and E.ON – still control 80% of the market, albeit down from 95% in 2013.

The CMA previously found that energy customers were paying £1.4billion a year too much, largely because 70% were stuck on rip-off standard variable tariffs. However, officials say this figure has since dropped to 57%.

The CMA also claimed SSE and Npower “are not close rivals” for standard tariff customers.

SSE boss Alistair Phillips-Davies called the merger “a great opportunity to create a more agile, innovative and efficient company”.

But Alan Whitehead, Labour’s Shadow Minister for Energy and Climate Change, said: “Given both companies already struggle to provide good customer service, job losses in customer care as well as other departments must be avoided at all costs.”

Alex Neill from Which? said: “We will be watching to make sure that hard-pressed households don’t face even more expensive energy bills as a result of this decision.”