More grist to the mill for the energy market naysayers as the decision from t
he Competition and Market Authority’s (CMA) probe into the energy sector not to focus its investigation into the UK wholesale gas market was endorsed by the All Party Parliamentary Group on Energy Costs.
The CMA had come under fire for excluding the gas market from its investigation as it defended its liquidity and transparency as an example for which the far more opaque electricity market should follow.
Many did not share this view and immediately labelled the CMA’s work as compromised. The CMA’s decision however has been vindicated by the findings of the Parliamentary Group.
The group’s Chairman, Lord Palmer, announced:
“This is the definitive guide to the British wholesale gas market. The report shows the UK market to be the most competitive and transparent in Europe.
“This information [real time market data] is freely and widely available to any interested party”
Palmer’s report went on to highlight that the gas market is the only market that fulfils the EU’s trading liquidity standards. A feather in the cap for all concerned.
In contrast the initial CMA findings into the wholesale electricity market bore out their desire to place it under the microscope unlike its gas counterpart.
Once again the CMA concluded that Ofgem, the energy market regulator, rather than improving liquidity and transparency in the market was actually compromising it by the implementation of policies they created.
The CMA concluded:
“It was not obvious to us that [Ofgem’s] micro-level interventions had any potential to cause a step change in the overall level of liquidity in the market”
Even when the CMA isn’t investigating the stones they have kicked over are highlighting the market realities. If only politicians and the media would listen.