The EIUG agrees that the economic regulators should be included in the scope of the growth duty. However, it also believes that the growth duty should not only apply to those businesses that are part of the business community, as defined in the statutory guidance under section 110(6) of the Deregulation Act 2015, but also to businesses as consumers, whose interest the regulators aim to protect.
Energy intensive industries’ (EIIs) experience with Ofgem is that the regulator understands the businesses in its business community well – generators, system network operators, energy suppliers, etc. – but lacks an understanding of businesses as end-consumers of energy, and in particular how its regulations impact on the business environment of EIIs.
Whilst Government has recognised that the business environment of relatively high industrial electricity prices and the risk of carbon leakage deter investments and trade by EIIs – and has taken and is taking some measures to address them – the energy regulator has not.