A proposed merger between npower and the retail arm of SSE has provisionally given the green light, paving the way for one of the biggest shake-ups to the energy sector for years.
The Competition and Markets Authority’s (CMA) investigation into the proposed deal found the two energy companies do not compete closely on standard variable tariff prices. Few people switch between SSE and npower, it added.
Therefore, the CMA said, the merger is not expected to have a significant impact on standard variable tariff pricing.
Anne Lambert, chair of the CMA inquiry group which reviewed the deal, said: “We carefully scrutinised this deal, in particular how it would impact people who pay the more expensive standard variable prices.
“Our analysis shows that the merger will not impact how SSE and Npower set their SVT prices because they are not close rivals for these customers. Looking ahead, Ofgem’s price cap is also expected to protect SVT customers.”
Alistair Phillips-Davies, chief executive of SSE: “The scale and pace of change in the GB energy market continues to be significant and requires us to evolve to stay relevant, competitive and sustainable. The planned transaction presents a great opportunity to create a more agile, innovative and efficient company that really delivers for customers and the energy market as a whole.”
“We look forward to continuing to engage with the CMA as it prepares its final report ahead of the statutory deadline in October. We remain confident that the formation and listing of the new company is on track for completion by the end of SSE’s financial year.”