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Monopoly Electricity Suppliers

Volume 523: debated on Thursday 10 February 2011

16. What steps he is taking to ensure that electricity consumers in areas with only one supplier are not charged excessive amounts. (39424)

Ofgem regulates distribution network operators through price controls that limit the amount that they can charge for connection services. For most connection services, DNOs can recover only expenses that are reasonably incurred. When a customer disputes a connection charge, they can raise the issue with the DNO through its complaints procedure. Ofgem has powers to determine whether a connection charge is reasonable after other avenues are exhausted.

My constituent David Goulty has been quoted £1,200 for a connection by UK Power Networks. Also, the Snetterton industrial site near the A11 has been quoted £6 million to £8 million for connecting it to the national grid. I am concerned that this company is the sole supplier in this area, and I would like to know what action the Government and Ofgem are taking to ensure that it is not charging over the odds for connections.

My hon. Friend raises a very important point, which I hope she will pursue through Ofgem as well. The costs of those mechanisms are calculated by the local area network using a methodology agreed by Ofgem, which means that it can recover only reasonable costs associated with the connection work. If the complaints procedure has been exhausted, Ofgem can then determine whether the costs are reasonable. Consumers can also consider using an independent connection provider that might be able to offer a better deal.