Select Committee on Trade and Industry Annxes to the Report

Annex A


Progress in the Liberalisation of the Gas Market, Second Report of 1997-98, HC 338: Government Response, Sixth Special Report, HC 747

  1.  The Committee first reported on the gas market in 1994. Following the introduction of competition into the domestic market over 1996-97, and the demerging of British Gas into Centrica and Transco in 1997, it undertook an inquiry into the issues surrounding liberalisation. The Committee held two oral evidence sessions in November 1997 and published its Report in January 1998.

  2.  The Committee expressed concern over the outstanding issues regarding prepayment meters and customers using them, particularly in reference to payment issues and urged that Ofgas exercise vigilance in relation to potentially anti-competitive practices. It recommended the establishment of an Energy Consumers' Council as soon as possible, and the development of new regulatory mechanisms to deal with multi-utility provision.

  3.  The Government response was received in June 1998. Gas and Electricity regulators were charged with writing an action plan to address prepayment issues. Competition issues were included in the 1998 Competition Act which created the Competition Commission. The Government subsequently published the Green Paper on Utility Regulation which looked at multi-utility regulation.

  4.  The Committee has pursued these matters in annual evidence sessions with the Regulator, most recently on 28 November 2000.

Development in the Liberalisation of the Domestic Electricity Market, Tenth Report of 1997-98, HC 871: Government Response, Seventh Special Report, HC 1130, pages xvii-xxiii

  1.  The Committee reported in 1995 and 1997 on the electricity supply market and its liberalisation. By the beginning of 1998 the Overall Programme Manager to the Director General of Electricity Supply had admitted that the programme for liberalisation had slipped. Following this announcement and in the light of its Report into gas liberalisation, the Committee undertook an inquiry into the development of electricity liberalisation. It heard evidence in June 1998. The Report was made in July 1998.

  2.  The Committee recommended that the Director General of Electricity Supply (DGES) use the review of price restraints due in 2000 to reassess the Public Electricity Suppliers' (PES) "allowable" costs and urged the DGES to compile comparative figures for consumers enabling them to identify where savings might be made. It expressed its concern at the spiralling costs of liberalisation, which had risen from a projected £375 million over five years to £726 million.

  3.  The Government responded in October 1998. It agreed that PESs' allowable costs would be reviewed in 2000; PowerGen and National Power were required to divest plant to encourage competition.

  4.  The Committee has pursued these matters in annual evidence sessions with the Regulator, most recently on 28 November 2000.

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