Research commissioned and published by Utility Week has revealed some interesting attitudes at the top of UK Utilities. Their survey of 24 CEOs revealed almost two thirds believe their regulatory system could improve. This rises to 75% for domestic water wholesalers.
In direct contrast, 80% from gas networks and 71% from power networks believe their regulators are ‘fit for purpose’ reflecting positively on the RIIO 2 price setting process.
Gas and power network CEOs were largely behind Ofgem’s framework at this early stage, believing it fitted the changes and future requirements of the industry.
Continuing the split in views, water wholesale CEOs voiced a number of criticisms of Ofwat’s current price control methodology. Three quarters did not believe the dividend policy forms were fair and proportionate.
When asked why regulatory frameworks were not working responses included “too intrusive, drives wrong behaviours, needs more radical approach,” “lacking of an understanding of competition” and “too much political interference”.
Some CEOs remained more neutral, acknowledging that if they were all collectively content the regulators probably would not be doing their job.