The EIUG welcomes the Government’s decision not to move to zonal pricing and focus on a package of reforms to improve the effectiveness of Great Brittan’s national pricing model instead. Over the past years, DESNZ has not set out the analysis what impact it might have on energy intensive industries to justify a move to zonal pricing. Key questions about the number of zones, degree of zonal market liquidity or potential impact on industrial retail electricity prices in zones have never been answered.
The EIUG looks forward to working with DESNZ and Ofgem to implement an ambitious approach to reformed national pricing.
Arjan Geveke, Director of the EIUG, said:
“We welcome the decision not to move to zonal pricing as its potential impacts on energy intensive industries have never been set out to justify it.
While today’s decision provides clarity on the direction of electricity market reforms, the Government must ensure that the alternative to zonal pricing, reformed national pricing, supports rather than hinders industrial competitiveness.
The EIUG will work with DESNZ and Ofgem to implement an ambitious approach to reformed national pricing to ensure it does.”