Ofgem's policy on electricity distribution mergers

Ofgem policy statement (28 pages, PDF) on its response to mergers of electricity distribution network operators. There is no power to block these mergers on the grounds of loss of comparators (contrary to the position for water mergers).

Ofgem has decided to make a pre-specified price control adjustment when companies merge. The adjustment is commensurate with an objective of capturing merger cost savings for the benefits of customers, but is explained by reference to a calculation of the detriment associated with the loss of a comparator.

For further information or advice please contact Franck Latrémolière.

Filed under Electricity, Ofgem, Price controls.

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