Big power firms face new claims of 'gaming'

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The Independent Online

The big power generators were accused of rigging the market again yesterday after electricity prices charged to large users soared to £164 a megawatt hour - twice what domestic consumers pay.

The surge in prices was blamed on the generators removing plants from the electricity pool, so ensuring much higher capacity payments for power stations remaining on the system.

The highest price bid into the pool was £30 a megawatt hour. But by the time the capacity charge had been added, the price had risen to £164.

Independent electricity suppliers said there was renewed evidence of "gaming" in the pool by the big generators before the system for electricity trading is overhauled this November. Eddie Cumberland of the Ipswich-based UK Electric Power, which specialises in supplying large commercial users, said: "We have major industrial customers exposed to this high pool prices. Saying to them that they are going to get help next November isn't much comfort now."

Mr Cumberland intends to present a paper to a meeting of the Electricity Pool executive next Thursday which would prevent the big generators from ratcheting up prices by withdrawing plant.

The energy regulator, Ofgem, has recently clamped down on gaming by inserting a "good behaviour" clause into the licences of the biggest generators. This followed evidence of regular price spikes last summer between July and October - a period when demand is less and prices should also be lower.