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The Energy and Climate Change Committee (ECCC) has supported government plans to give Ofgem more powers to affect industry change and introduce competition to onshore transmission assets.
The ECCC said the government’s proposals in the draft legislation on energy, currently in pre-legislative scrutiny “put the needs of customers front and centre.”
However the ECCC acknowledged concern in the industry at giving Ofgem the power to change industry codes in order to drive through faster switching and half-hourly charging, by recommending amendments to ensure transparency.
ECCC chair Angus MacNeil said: “The energy industry has for too long been able to decide when to change the way it engages with the energy market. This has not served consumers well.
“But in the interests of clarity and transparency, we believe that Ofgem should publish an impact assessment of any changes it proposes to make.”
The ECCC also recommended that industry should be allowed the right of appeal against any changes it “disagrees [with] on merit.”
It said introducing competitive tendering for onshore transmission assets was “a positive move in principle”, but recommended that Ofgem publish impact assessments to address the ECCC’s concerns that competition could delay projects.
Decc said introducing competition to onshore transmission could deliver £380 million of savings to consumers in “operational costs alone” over the 25-year lifetime of the licences.
The ECCC has also backed an extension to the energy secretary’s powers to oversee the smart meter roll-out by three years to 2023, but McNeil has urged parliamentarians “to continue pressing the government on the issue” to ensure the roll-out runs to time.
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