New inquiry focuses on energy pricing and future of energy market

0
244

Following unprecedented surges in wholesale energy prices since the summer and with a number of firms going out of business, Business, Energy and Industrial Strategy (BEIS) Committee has launched an inquiry on energy pricing and the future of the energy market.

The inquiry will examine the extent to which the policy and regulatory environment has contributed to the current issues affecting the energy market, the impact on consumers of rising energy prices, and the operation of the energy price cap.

Launching the inquiry, Darren Jones, Chair of the Business, Energy and Industrial Strategy Committee, stated: “Too many energy companies have been unable to weather the storm wreaked by surges in wholesale energy prices.

“Given the current state of the UK energy market and the impact on consumers of rising energy prices, it’s important we examine how the sector slipped into this crisis and what policy and regulatory measures will be necessary to fix it.

“In our inquiry, we will want to hear from energy bosses, from consumers, and from Government and Ofgem about the challenges facing the energy market.

“We will want to understand how far the energy price cap is able to protect consumers and examine questions of whether there should be a more interventionist approach from the regulator and tougher barriers placed on firms wishing to enter the energy market.”

The Committee welcomes evidence submissions on the terms of reference outlined below. The closing date for submissions is 31 January 2022.

  • The regulatory requirements companies must meet in order to trade as a regulated entity in the retail energy market.
  • The mandate, role and performance of Ofgem in setting regulation and supervising regulated entities.
  • The performance of previous policies introduced to stimulate effective competition within the retail energy market, and an assessment of the impact on competition of proposed future regulatory frameworks.
  • The functioning and performance of the ‘energy price cap’ and an assessment of its use in the future, and an assessment of the role of auto-switching.
  • The future of Bulb and the recovery of public funds and the cost to consumers of other energy supplier failures.
  • The role of retail market reform in the context of the UKs net zero transition and domestic energy security requirements.
  • The comparison of UK wholesale prices and additional costs with the wholesale prices and additional costs across Europe.

Evidence sessions for this inquiry are likely to begin in early 2022.

More information about this inquiry and how to take part is available on the UK Parliament website.