Competition watchdog to probe merger of SSE/NPOWER

Initial ruling by CMA due by 26 April this year Regulator to judge if merger anti-competitive

The move by Scottish Hydroowning SSE and Innogy, the German owner of Npower, to merge their UK operations to create a new domestic energy supplier is to be probed by the competition regulator. The two companies announced in November that they had agreed to merge their British household energy supply and services businesses, reducing the Big Six energy suppliers to five.

The Competition & Markets Authority (CMA) said yesterday that its inquiry will focus on whether the deal would reduce significantly the competition for supplying energy to UK domestic customers.

The CMA said it has until 26 April to make an initial decision. In a statement, the watchdog said: “The CMA has been discussing the deal with SSE Retail and Npower since it was announced.

“Now that the companies have provided the information necessary to start an investigation, the CMA has launched its review.”

The new business would be listed on the London Stock Exchange, with SSE shareholders holding 65.6 per cent of the shares and Innogy the remaining 34.4 per cent.

SSE is Britain’s second biggest energy supplier and the merged group would serve 1.5 million customers.

Scottish Gas-owning Centrica, Scottish Power-owning Iberdrola, E.ON, the German utility, and EDF of France make up the remainder of the Big Six.

Major suppliers are facing a raft of regulatory changes after legislation designed to cap “poor-value” energy tariffs for 11 million British households was introduced in Parliament on Monday.

The Domestic Gas and Electricity (Tariff Cap) Bill would allow Ofgem to limit tariffs until 2020, with the option to extend the cap annually until 2023.

Prime Minister Theresa May said the bill, which the government hopes will become law before next winter, would “force energy companies to change their ways”.

A 2016 report found consumers were paying £1.4 billion a year over the odds via energy companies’ standard variable tariffs (SVTS). l Keith Anderson has been appointed chief executive of Scottishpower, a promotion from his previous combined roles as CEO of Scottishpower Renewables (SPR), and chief corporate officer of Scottishpower.

Lindsay Mcquade becomes chief executive of SPR. She was previously Scottishpower’s policy and innovation director.