Ofgem is overhauling its classification system for suppliers after a clutch of challengers emerged to vie with the traditional energy market giants.
The regulator will no longer use the label “Six Largest”—the Big Six, in shorthand—in its Industry data, reflecting a transformed market.
The Big Six—British Gas (Centrica), EDF, E.ON, npower, Scottish Power and SSE—once controlled 98% of the domestic supply market. That has now shrunk to under 57%, after acquisitions, mergers and a customer exodus to smaller challengers.
The biggest winners in the energy market wars have been Bulb, Octopus and Ovo which have attracted customers with green credentials, technological innovations and discount prices. Collectively they now hold 30% of the market.
Ovo further shook up the ranks of the Big Six when it acquired SSE’s household division, with more than five million customers, for £500 million in January. The sale made Ovo the country’s second-largest energy supplier, after British Gas, with a 15% market share as of October 2020.
Meanwhile, E.ON acquired npower in September 2019 and is slowly phasing out the brand.
With the Big Six label now obsolete, Ofgem will use classify suppliers based on market share.
The new taxonomy will group Ovo (15% market share), Octopus (5.1%) and Bulb (5.7%) alongside British Gas (18%), EDF (18% when combined with Npower), E.ON (12%) and Scottish Power (9%) in a new "large" category, representing companies with more than 5% market share in either gas or electricity.
A "large legacy" grouping will include suppliers which have had held a market share of at least 5% since privatisation.
Ofgem is writing to industry executives to alert them of the new classification system, which it says will make "indicators more robust and suitable to analyse the evolving retail market structure.”
Ahead of the COP26 summit in Glasgow, the UK’s mobile...
The government will today convene a task force with telecoms...
The UK government has issued a new “call for evidence”...
The energy retail arm of Royal Dutch Shell will take...