In the latest in our series analysing the responses of key players to the CMA investigation into the UK energy market we focus on nPower, the Big 6 energy supplier.
nPower seem to make a habit of blaming others for their own issues and their response to the CMA investigation is apparently no exception.
Indeed fresh from ‘re-aligning’ nPower’s stated goal of becoming the “Number one energy supplier for customer satisfaction” by the end of 2014 to now targetting being number 5 out of 6, Paul Massara, Chief Executive, wasted no time in laying the blame for the ills of the energy markets squarely at the feet of opposition leader Ed Miliband.
Those familiar with these pages will know that we have no love for Red Ed and his crazy, ill thought through and unworkable schemes but even at our most critical we would not have made the leap that Massara apparently has.
In a private letter to Ofgem Massara claimed that it would be too ‘dangerous’ for nPower to reduce energy bills as they may be unable to raise them again should Labour succeed in the 2015 general election and implement their much vaunted energy price freeze ‘policy’.
Massara said in his letter to equally beleaguered Ofgem Chief Executive Dermot Nolan:
“The potential Labour price freeze has, of course, also complicated all pricing decisions further.
“The political and media pressures at the moment make it more difficult to reduce prices and then increase them again next spring.
“Then we are acutely aware that if the Labour party were to implement their proposed price freeze, we will be living with the consequences of our standard tariff price for a very long time and beyond the level of risk that we could manage in the wholesale market.”
Some may say Massara is being refreshingly honest, others that this is another in a series of typical misjudgements.
In a further indictment of nPower however it has become apparent that unlike their contemporaries they had hitherto refused to make public their response to Ofgem’s June request for suppliers to explain why they had failed to reduce energy bills over a period where wholesale prices had fallen significantly. Given the substance of its content its easy to see why they didn’t wish it so be in the public domain.
nPower claim that their about turn on publishing the letter followed an “internal review” of “commercially sensitive information” and as a result issued its response in conjunction with its submission to the CMA investigation on the energy market
Caroline Flint, the Shadow Energy Secretary, said:
“All the energy companies have 101 excuses about why they won’t cut their prices, but if nPower are publicly admitting that they are keeping their prices artificially high that shows exactly why we need reform of the energy market.”
On balance then, nPower appear to have reverted to type with a typically unfortunate reaction to transparency that has overshadowed their commentary on the CMA investigation itself.
With the threat of an indefinite ban on sales still hanging over them from Ofgem and with the German owned business remaining a distant 6th out of 6th in customer service rankings the outlook for nPower does not look good whatever the final conclusions of the CMA probe.