SSE and Innogy merger should be subject to ‘proper scrutiny’

Labour calls on Competition and Markets Authority to ensure deal does not ‘substantially lessen’ competition

Labour has urged the government’s competition watchdog to ensure the planned merger between the retail energy arms of SSE and Innogy does not hurt customer choice.

It was confirmed yesterday (8 November) that Innogy’s British retail business Npower will be merged with SSE’s household energy and energy services business to form a new independent retail energy company.

Responding to the announcement of the tie-up, Rebecca Long Bailey, shadow secretary of state for business, energy and industrial strategy, said: “The energy market is broken in the UK. A merger of two of the biggest players which may diminish competition should, therefore, be subject to proper scrutiny.

“If the relevant legislative thresholds are met, then the Competition and Markets Authority should seek to satisfy themselves that there will not be a substantial lessening of competition through this transaction. This is why Labour want to set up local publicly owned companies to rival the big six and increase competition.”

Alex Neill, managing director of home products and services, Which? said: “Mergers of such big players in essential markets, such as energy, are rarely a good thing for consumers, especially given the low levels of competition. 

“As both businesses struggle on customer service, coming in the bottom half of our satisfaction survey, the competition authorities must take a hard look before allowing any venture to go ahead.”