UK
Ireland
Scotland
London
Construction News
20/04/2011
CC Confirms Variations To Centrica Undertakings
The Competition Commission (CC) has today confirmed the undertakings that will continue to control Centrica's ownership and operation of the Rough gas storage facility.
The CC has been reviewing the undertakings that were first given by Centrica Storage and Centrica following its acquisition in 2002 of the Rough gas storage facility. The CC has confirmed its provisional decision made in January that it intends to keep the undertakings in place but it will vary some of the restrictions.
Rough is a gas field in the North Sea used to store gas in the summer and deliver it in winter when the gas is needed to help meet higher demand. Rough provides the majority of Great Britain's gas storage for the winter.
Roger Witcomb, CC Deputy Chairman and a member of the Centrica Review Group, said: "Taking into account all the evidence we have seen, we were not persuaded that market conditions have changed enough to warrant removing the undertakings. While there has been a significant increase in the available capacity for importing gas to Great Britain, we found that Rough still has significant market power and Centrica remains by far the largest domestic gas supplier in the UK so Centrica’s ownership of Rough would still allow it to disadvantage its competitors.
"We also decided that new EU legislation affecting gas storage did not remove the need for the detailed and specific protections of the undertakings but we have varied the mechanism restricting Centrica's access to Rough more closely to align the undertakings with the EU legislation. The cost of continuing the undertakings is small compared with the potential detriment that would occur in their absence but we have decided to vary the undertakings in some areas, which will reduce the burden on Centrica.
"The undertakings were put in place after the investigation of the merger in 2003 to prevent Centrica from using its ownership of Rough to discriminate in favour of itself and against other users of Rough (particularly competitors in the retail gas market) in giving access to Rough capacity and to stop it disadvantaging other market participants in a number of other ways through its operation of Rough. The CC believed that this would have had the effect of weakening competition, with the likely consequence of higher end-user gas prices than would otherwise have been the case."
The varied undertakings will maintain restrictions on Centrica but make alterations to limits on the amount of Rough capacity that Centrica's wider group would be able to purchase from CSL as well as varying other restrictions.
(CD)
The CC has been reviewing the undertakings that were first given by Centrica Storage and Centrica following its acquisition in 2002 of the Rough gas storage facility. The CC has confirmed its provisional decision made in January that it intends to keep the undertakings in place but it will vary some of the restrictions.
Rough is a gas field in the North Sea used to store gas in the summer and deliver it in winter when the gas is needed to help meet higher demand. Rough provides the majority of Great Britain's gas storage for the winter.
Roger Witcomb, CC Deputy Chairman and a member of the Centrica Review Group, said: "Taking into account all the evidence we have seen, we were not persuaded that market conditions have changed enough to warrant removing the undertakings. While there has been a significant increase in the available capacity for importing gas to Great Britain, we found that Rough still has significant market power and Centrica remains by far the largest domestic gas supplier in the UK so Centrica’s ownership of Rough would still allow it to disadvantage its competitors.
-- Advertisement --
"We also decided that new EU legislation affecting gas storage did not remove the need for the detailed and specific protections of the undertakings but we have varied the mechanism restricting Centrica's access to Rough more closely to align the undertakings with the EU legislation. The cost of continuing the undertakings is small compared with the potential detriment that would occur in their absence but we have decided to vary the undertakings in some areas, which will reduce the burden on Centrica.
"The undertakings were put in place after the investigation of the merger in 2003 to prevent Centrica from using its ownership of Rough to discriminate in favour of itself and against other users of Rough (particularly competitors in the retail gas market) in giving access to Rough capacity and to stop it disadvantaging other market participants in a number of other ways through its operation of Rough. The CC believed that this would have had the effect of weakening competition, with the likely consequence of higher end-user gas prices than would otherwise have been the case."
The varied undertakings will maintain restrictions on Centrica but make alterations to limits on the amount of Rough capacity that Centrica's wider group would be able to purchase from CSL as well as varying other restrictions.
(CD)
Latest Construction News
29/01/2025
Caddick Construction has been awarded a £43 million contract to deliver the first phase of Cole Waterhouse's flagship regeneration scheme in Digbeth, Birmingham.
The project, known as Upper Trinity Street, marks a significant step in the area’s transformation.
Spanning 182,986 square feet, the re
29/01/2025
McLaren Construction has been appointed by O&H Properties to deliver the first phase of a £60 million Foster & Partners-designed development at the corner of New Bond Street and Grafton Street in London’s West End.
The seven-storey, 5,400 square metre prime retail and office scheme will feature ret
29/01/2025
GMI Construction Group has been awarded a contract to develop three high-specification warehouse units totalling over 175,000 square feet at Precedent Drive, Milton Keynes.
The £20 million project, commissioned by DV5 Last Mile Developments (UK) Ltd, a joint venture between Coltham and Delancey Re
29/01/2025
Plans for 106 sustainable new homes in Southville, a neighbourhood in South Bristol, have been approved as the city seeks to increase housing delivery to address growing demand.
Top 10 award-winning housebuilder The Hill Group will create a £60 million development on Raleigh Road, on land that was
29/01/2025
Bouygues UK has reached a major milestone in the fourth phase of the Hallsville Quarter regeneration project in Canning Town, London.
The project, part of the £3.7 billion Canning Town and Custom House Regeneration Programme, recently held a topping out ceremony, marking the completion of the 11-s
29/01/2025
Willmott Dixon Interiors is carrying out a significant upgrade to the roof of the National Maritime Museum in Greenwich, one of London's most iconic cultural landmarks.
As part of the £12 million project, the company is installing over 23,000 square feet of sun-protected glazing above the museum’s
29/01/2025
Equans has been appointed by Babergh and Mid Suffolk District Councils to carry out crucial decarbonisation work across the councils' housing stock, using funding secured through the Social Housing Decarbonisation Fund (SHDF).
The councils used the South East Consortium's Zero Carbon Framework to s
29/01/2025
In the world of construction, the quest for energy efficiency and sustainability is ever-evolving. Among the array of solutions available, EPS (Expanded Polystyrene) insulation stands out as a versatile and effective option for enhancing the thermal performance of buildings, particularly when used f
29/01/2025
BCP Council has completed significant coastal protection works at Hamworthy Park, ensuring its resilience against erosion for the next 20 years.
A 200-metre stretch of sea wall along the eastern promenade has been reinforced using low-carbon concrete, while new steps have been constructed to improv
29/01/2025
Geo-environmental consultancy and remediation contractor, The LK Group, has strengthened its team with a trio of recruits.
The multidisciplinary company's latest raft of hires comprises a new director, associate director and remediation manager.
The geo-environmental specialist, headquartered i
