Electricity prices to rise after savings bonanza

6 June 2001
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07 June 2001 | Robin Parker

Electricity prices are set to rise just two months after the introduction of the New Electricity Trading Arrangements (Neta), an industry expert has warned.

"In 10 years, the liberalised market has delivered price reductions of more than 30 per cent, but I've yet to be convinced that Neta will provide further savings," Martin Rawlings, deputy chairman of CIPS's energy committee, told the Utel energy and utilities conference in Birmingham.

"Prices cannot go any lower a rise is due."

Suppliers will have to get used to the new trading arrangements, said Howard Blanch, sales manager for Scottish & Southern Electricity. "Neta demands a tight forecast system to within 3 per cent accuracy. But this level of accuracy has no real track record. We will see less volatility when suppliers get their act together and manage forecasting."

Energy regulator Ofgem is reviewing Neta's impact on smaller generators and is examining 12 modification proposals suggested by suppliers.

SMjun2001

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