Thursday, 13 March 2008

National Grid to appeal Competition Act decision on Metering

The following posting was placed on the National Grid website.

National Grid plc (“National Grid”) is extremely disappointed with the Gas and Electricity Markets Authority’s (GEMA) decision that National Grid has infringed the Competition Act in relation to a number of metering contracts entered into with gas suppliers in 2004.

These contracts were negotiated over a two year period, were voluntarily entered into by gas suppliers and delivered immediate and substantial reductions in charges for meter services, saving customers around £120m over the four years of their operation. Ofgem was consulted throughout this process of contract development and negotiation and has acknowledged that National Grid had no intention to breach the Competition Act.

We are convinced that the contracts do not infringe competition law and therefore believe that they should remain in full effect. We also believe that the £41.6m fine is wholly inappropriate. We will be lodging an appeal with the Competition Appeal Tribunal.

National Grid’s Chief Executive, Steve Holliday, said: "National Grid has been instrumental in helping Ofgem to develop competition in the UK metering industry, and we strongly believe we have never acted anti-competitively in the development of our contracts. Despite nearly three years of exhaustive analysis by Ofgem, we believe there is no evidence that National Grid has harmed consumers, competition or gas suppliers, and we are left with no option but to present our case to the Competition Appeal Tribunal.”

Source: National Grid

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