EDF’s Possible Acquisition of British Energy Concerns MPs

EDF may eventually control UK electricity market if allowed to acquire British Energy. This was cautioned by MPs, stating that healthy competition is essential for a stable and fair market. The Commons Business Select Committee released a document that could severely damage EDF’s chances of winning its bid of £12.4bn for taking over British Energy. The same document raised concerns about the possible dilution and weakening of UK’s varied electricity supplier choices if EDF has its way. Ofgem has now been appealed to, to bring in controls that will regulate the market and curb attempts to exclusively rule the market. Industry sources indicate that EDF, a French electricity supplier company may place its bid for British Gas within a few days. EDF, it is believed is also making attempts to take a smaller stake with Centrica, the founder organisation of British Gas.

The eagerness to acquire British Energy on the part of EDF is well-known. British Energy controls eight nuclear power stations and a single coal-fired plant; the locations of which are being seriously considered for housing future nuclear power stations. What has raised the hackles of MPs and industry watchers is that EDF already has a 7% slice of the pie in terms of UK’s electricity supply market. British Energy, if taken over by EDF will give the latter an additional slice of 35% in the market. Other electricity suppliers have also voiced similar concerns about EDF’s possible dominance of the market.

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