June 10 (Bloomberg) -- The U.K.’s opposition Labour Party said it will set up an energy board if it wins next year’s election, giving authorities the power to force utilities to cut their bills when wholesale costs decline.
In 2009, when wholesale prices dropped, the reductions were never passed on to consumers, Caroline Flint, the Labour lawmaker who speaks on energy, said today at a conference in London. Wholesale costs form the largest part of consumer’s bills, she said.
The suggestion would mean combining into one body the functions of Ofgem, the Department of Energy and Climate Change and National Grid Plc in regulating and managing the power industry. Labour also wants to split utilities into separate businesses that supply and generate power, she said.
Energy costs have been at the center of the political debate since September, when Labour leader Ed Miliband pledged to freeze tariffs for two years because of concerns that electricity prices were rising faster than inflation. The U.K.’s biggest energy companies are facing an inquiry into excessive profits, adding to speculation an overhaul of regulations governing the industry may be on the way.
Centrica Plc and SSE Plc, two of the six biggest suppliers, issued profit warnings this year after their costs increased because of government levies for renewables.
To contact the reporter on this story: Nidaa Bakhsh in London at email@example.com
To contact the editors responsible for this story: Will Kennedy at firstname.lastname@example.org Reed Landberg, Alex Devine