Ofgem drops investigation into SSE

Ofgem has closed an investigation into SSE with no decision made on whether the supplier infringed competition law.

The regulator has decided to accept legally binding commitments to improve services needed for competitors to connect customers to its distribution network.

A Competition Act investigation was launched last year into SSE’s network business, after a review of the sector uncovered potentially anti-competitive behaviour.

The investigation identified competition concerns around SSE’s behaviour in providing services needed for competitors to connect new developments to its electricity distribution network in the South of England. These included inconsistencies in providing essential services needed to allow competitors to compete effectively, including inconsistency in quotes. 

SSE will put new processes and procedures in place to make sure it provides these essential services to all parties on a consistent basis. The steps include separating the team that provides essential services to the connections market from the team that competes in the connections market and third party auditing of and reporting on SSE’s compliance with the commitments.

Ofgem says that these commitments “will fully address the competition concerns”.

The whole market for providing electricity connections is worth over £500 million per year in Great Britain, as independent companies compete against regional distribution network operators, such as SSE, to connect new customers to these networks.

Ofgem has also recently introduced a new Code of Practice and associated licence condition to force all electricity distributors to open-up competition in the electricity connections market.