Major utility companies in the UK have “undue influence on UK energy policy and regulation” which is “hindering the clean energy transition and posing significant investor risk”, according to a report commissioned by Friends Provident Foundation.
The report – ‘Gridlock in UK Power Markets’ – was produced by InfluenceMap and outlines factors that large incumbents use to “essentially capture the regulatory process”.
The factors include: influencing the public narrative on the electricity sector; chief executive messaging; dominating the official regulatory consultation processes; and access to politicians.
The report said that representatives from the so-called ‘big six’ companies have met with policy makers 166 times since 2015, more than twice as many times as all other power market participants combined.
Friends Provident Foundation investment engagement manager Colin Baines said: “It should concern investors that the business models of the big six appear to be based on their current ability to maintain the status quo via regulatory influence.”
The report also said that the main players in industry are particularly effective when they lobby together.
It said: “A clear example can be seen in regulator Ofgem’s June 2017 decision to restrict so-called embedded benefits payments to small-scale, distributed energy.”
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UK green transition ‘hindered’
New report raises concerns over utility giants' influence on policy
By EBS