E.ON Next completes acquisition of Ovo Energy in the UK — The Guardian
In the United Kingdom, E.ON Next has completed the acquisition of energy supplier Ovo Energy after the deal was approved by the UK competition regulator. As a result, nearly three-quarters of households in the UK will be served by three companies, The Guardian reports.
No immediate changes are expected for Ovo's 4 million customers. Before the deal, E.ON Next supplied energy to 5.6 million households, and following the acquisition it will hold 25% of the UK's domestic energy supply market and become the second-largest supplier.
The three largest suppliers
Octopus Energy has the largest market share at 26%. British Gas, which was previously the largest supplier, now serves about 23% of households. Together, these three companies will cover nearly 75% of the UK's household energy supply market.
Including EDF Energy and Scottish Power, five suppliers will control about 90% of this market.
More current news is available on the UA.News Telegram channel Telegram.
Concerns over competition
Tom Goswell, head of energy supply at consultancy Cornwall Insight, said that the former “big six” suppliers had effectively become a “big three.” According to him, large companies can provide stability after about 30 firms exited the market, but a smaller number of suppliers could weaken competition on prices and the variety of offers.
E.ON UK chief executive Chris Norbury disagreed with these concerns, calling the market fiercely competitive. He said that the company's scale and flexibility would enable it to operate in customers' interests and prepare for future changes in the energy system.
In 2016, the six largest suppliers controlled about 85% of the UK energy market. At the time, the Competition and Markets Authority warned that weak competition was causing consumers to overpay by between £1.4 billion and £1.7 billion each year.
