Ignore whining energy companies, Ofgem is right to cap their returns

They’re characterising it as a missed opportunity to hasten the move to net zero. It’s not. They’re being treated very generously, says James Moore

Energy companies’ returns are going to fall (Reuters)

It’s either a “massive missed opportunity” that’s “gravely at odds with the UK government’s ambition to boost investment in green infrastructure”, or it’s a bold plan to “transform Britain’s energy networks to deliver emissions-free green energy for GB along with world-class service and reliability”.

The former is the view of Scottish Power CEO Keith Anderson concerning Ofgem’s announcement of a £25bn plan aimed at sprucing and greening up Britain’s energy networks. You won’t be surprised to learn that the latter is Ofgem’s preferred characterisation of what it’s doing.

But which is correct? I suspect that anyone with knowledge of Britain’s dysfunctional energy system, which has been that way ever since the Conservative Party privatised it, would have said the second.