As the regulators are looking more favourably on allowing market forces to do their work, David Gow looks at what is in store for the utility companies this year Britain's utilities face yet another period of convulsions this year under the triple pressures of regulation, consolidation and competition. As the year opens, it's a fair bet that by the end of another twelve months the energy, water and telecoms markets of the UK will look significantly different from what obtains today. In energy the regulator, Callum McCarthy of Ofgem, is set to remove price controls on British Gas, part of the ever-growing Centrica group, at the end of March and declare the gas market fully open and competitive.
Electricity follows a year later.
It means that instead of regulation, which by its nature is intensive and intrusive, we can rely on competition to do our work for us. New, smaller entrants, already suffering from consumer inertia to switching suppliers, will find it hard to survive and many will simply go to the wall. But some among the older, more established players are finding the going tough. Ian Russell, due to step up to Chief Executive of ScottishPower in April, and Ian Marchant, Finance Director of Scottish and Southern, have publicly assailed the growing dominance of British Gas, voicing aloud the private thoughts of many fellow utility executives. Centrica, trading as British Gas, has retained more than 70 per cent of gas customers and won 15 per cent of electricity customers.