Ofgem threatens firms manipulating the UK wholesale energy market
Ofgem, the UK government regulator for gas and electricity markets, has threatened to fine companies caught attempting to manipulate the wholesale energy market.
According to The Financial Times, Ofgem sent a letter to companies earlier this week which said concerns had “been raised with us in respect of certain behaviours that may be taking place in the market”.
The warning relates to electricity generators providing consumers with false information about generating capacity, which concerns consumers as wholesale prices rise if there is an expectation of scarce supply in the market.
The letter, seen by the FT, went on to say that “Ofgem takes its responsibilities with respect to market conduct very seriously and monitors the market to probe potential breaches,” and highlighted the regulator’s power to “publicly censure, place unlimited financial penalties or institute criminal prosecutions”.
An Ofgem spokesman told Reuters:
“Generators must ensure that they are providing the most accurate information available on how much electricity their plant can generate and when, based on their experience in running the power stations that they are making available to the market.”
“We have not launched a formal investigation. But we are making it clear that if a generator submits a physical notification that is misleading, clearly this has the potential to be a breach of market rules,” he added.