Sept. 24 (Bloomberg) -- The opposition Labour Party pledged to break up Britain’s six largest energy companies and force them to trade all their electricity on the open market to drive down prices for consumers if it wins the next election.
“We will break up the big six; the power stations will be separated from the companies that send you your bill,” Labour’s energy spokeswoman, Caroline Flint, told her party’s annual conference today in Brighton, southern England. “Just as the banks will have to separate their investment and trading arms from the high-street branches, so we will make the energy companies separate their production from the companies that supply your home.”
The six largest energy companies, including Centrica Plc, EDF Energy Plc, EON SE, SSE Plc, Scottish Power Ltd. and RWE AG have different units generating, trading and supplying energy. In a July 29 report, Parliament’s cross-party Energy and Climate Change Committee said energy regulator Ofgem should act to make company profits more transparent.
“I promise with a Labour government the most radical, comprehensive reforms since energy privatization,” Flint said. “No more price setting in secret. The energy companies will be forced to open their books. And do all their electricity trading on the open market, in a pool.”
The U.K. has been debating energy costs after suppliers garnered criticism for posting profits while raising prices. Conservative Prime Minister David Cameron has said his government will change the law to tackle rising energy bills by forcing companies to charge each customer at the lowest rate for their type of use. His government’s Energy Bill is currently being considered by the upper House of Lords.
The Labour Party has used its annual conference to spell out a range of new policies with 20 months to go to the election. Both the party leader, Ed Miliband, and his Treasury spokesman, Ed Balls, have said they have no problem calling themselves “socialists.”
“Half a dozen companies, squeezing out competition, setting prices in secret, and never telling you if you’re getting a rotten deal,” Flint said today. “Prices rising year after year, followed by record-breaking profits.”
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