Energy suppliers argue Ofgem upgrade estimates too cheap - 04/08/2009
People looking to switch gas and electricity suppliers may be disturbed by news that energy companies believe Ofgem has underestimated the cost of network upgrades.
The energy industry regulator has said Scottish and Southern and Scottish Power must allocate £1.4 billion over the next five years to carry out measures such as upgrading the electricity networks in Scotland, but the companies have argued the figure is an underestimate, reports the Herald.
Scottish and Southern claims it will need to invest eight per cent more than the £523 million calculated by Ofgem, while Scottish Power argues it will have to spend 12 per cent more than the regulator's £832 million figure.
David Southwell, of the Electricity Network Association industry body, told the paper: "Ofgem says the companies must fulfil their obligations at one price and the electricity companies usually say it will cost them more. Sometime between now and the winter a compromise will be struck."
The major energy companies have committed to helping reduce the impact of consumer prices and millions of energy-saving light bulbs have been sent out as a result.
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