* Energy suppliers to lose chance to delay Ofgem rulings
* Consumers to be able to switch supplier more quickly
* Minister wants investigation into predatory pricing
By Tim Castle
BIRMINGHAM, England, Sept 20 Britain will boost
competition in its energy supply sector by strengthening the
hand of regulator Ofgem and forcing suppliers that breach
regulations to reimburse consumers directly, energy minister
Chris Huhne said on Tuesday.
Energy companies will no longer be able to delay Ofgem
rulings by up to a year by forcing the independent regulator to
seek a second opinion from the Competition Commission.
Instead, Ofgem will be able to proceed directly with its
decisions, with companies having a right of appeal, according to
advance extracts of a speech by Huhne to his Liberal Democrat
Party at its annual conference.
"We are determined to get tough with the big six energy
companies to ensure that the consumer gets the best possible
deal," Huhne said.
Britain's six largest utilities are German groups E.ON
(EONGn.DE) and RWE , British companies Centrica
and Scottish and Southern Energy , French operator EDF
and Spanish firm Iberdrola .
All have raised prices in recent months, putting pressure on
the government to ease the pain for consumers paying 20 percent
more, on average, for energy than a year ago, according to
comparison website USwitch.
Huhne said Ofgem should investigate whether small companies
were being kept out of the market by the larger firms' pricing
practices, with some making "cut-throat" offers to new customers
while keeping existing consumers on higher tariffs. "That looks
to me like predatory pricing. It must and will stop," he said.
The government will also consider giving Ofgem the power to
require energy companies to pay refunds to consumers directly or
to funds that benefit customers when they breach licence terms.
At present, fines go direct to government coffers for
Customers will also be able to switch suppliers more quickly
and officials will work on plans to allow organisations such as
housing associations to switch hundreds of tenants at a time to
cheaper energy companies, Huhne said.
E.ON UK chief executive Paul Golby said the government was
attacking the wrong target at a time of rising world energy
prices. "Blaming energy companies in Britain for global energy
costs is not productive. As just about all industry commentators
have said, the age of low price energy is over."
Evolution equities analyst Lakis Athanasiou said while the
moves would put pressure on profit margins, they would only have
a "mild bearish impact" on Centrica, the dominant player and
home to the British Gas brand.
"There is very little that encouraging switching will do to
reduce residential tariffs, and increased switching may even
drive up supply operating expenses, putting upward pressure on
prices," Athanasiou said.
(Additional reporting by Rosalba O'Brien and Sarah Young in
London; Editing by Dan Lalor)