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Ofgem’s reforms to boost competition in the energy market do not go far enough, according to Labour.
The regulator announced on Wednesday measures to increase liquidity in the wholesale power market and make large suppliers more financially transparent. These include making the major energy suppliers post wholesale power prices two years ahead.
Caroline Flint, shadow energy secretary, said the proposals “fall well short of what is needed”.
She hit out at “secret trades” between the generation and retail parts of the big energy companies and accused Ofgem of merely “tinkering round the edges”.
If elected, Labour is promising to freeze energy prices until 2017, while it breaks up the big six energy suppliers and creates a pool system for trading.
Ofgem reacted swiftly, saying Labour misunderstands the barriers to competition. Its reforms go futher than Labour’s, said a spokesperson, as they allow independents to access forward markets while the “pool” only relates to short-term trades.
Flint claimed: “While David Cameron refuses to stand up to the big energy companies, the next Labour Government will undertake the biggest overhaul of our energy market since privatisation. Our plans will break up the big energy companies, put an end to their secret deals and make tariffs simpler and fairer. And until these reforms kick in, we will put a stop to unfair price rises by freezing energy bills until 2017, saving the average household £120.”
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