Energy Bill

Baroness Anelay of St Johns Excerpts

Monday 4th November 2013 Lords Chamber

59A: Clause 43, page 27, line 18, leave out “may” and insert “shall”

[Baroness Anelay of St Johns]

My Lords, I invite colleagues to leave the Chamber quietly so that we may at least hear the mover of the amendment.

[Lord Berkeley (Lab)]

My Lords, the purpose of this amendment, in my name and that of my noble friend Lord Hanworth, is to require the Secretary of State, in dealing with the modifications to the licence conditions, to include in Clause 43(3)(b),

“provision imposing restrictions on the sale or purchase of electricity to or from group undertakings”.

This is an attempt to persuade the Minister, when she responds, to go a little further than she did in Committee last Monday when she said:

“There is no clear evidence that the divestment of retail businesses will increase competition or lower consumer prices”.—[Official Report, 28/10/13; col. 1386.]

I think that there is probably quite a lot of evidence, but we now have the opportunity to test this because, among many statements by the Prime Minister and the Secretary of State for Energy last week, Ed Davey said that they would introduce annual reviews of the state of competition in the energy markets and that the first of these new competition assessments will be delivered by spring of next year. He went on to say:

“The assessment will be undertaken by Ofgem, working closely with the Office of Fair Trading and the Competition and Markets Authority, when it comes into being”.—[Official Report, Commons, 31/10/13; cols. 1095-96.]

Those organisations, separately and together, are probably some of the best experts on competition issues we have in this country. It would be logical and right for them to include within certainly the first annual review a comment about separation. There has been an awful lot of talk about competition, which appears rightly to boil down to considering whether there is competition among those from whom you buy your electricity. However, the issue of competition at the other end and separating the generators from the retail end is just as important. I therefore wish to persuade the Minister to agree that the issue of separation within the assessment of competition that has been announced—and is very much to be welcomed—should be included. I beg to move.