'No evidence' of gas price rigging
A probe into alleged rigging of wholesale gas prices by power firms ended today with regulators saying they found no evidence of wrongdoing.
Electricity and gas watchdog Ofgem and City regulator the Financial Conduct Authority (FCA) said consumers have not been harmed as they closed a year-long investigation into suspect trading last September.
The probe was triggered after a whistleblower claimed the gas market had been ''regularly'' manipulated by some big power companies - prompting concern that this could affect energy prices for households.
The investigation focused on allegations that gas was sold at a lower-than-market price at around 4.30pm on September 28 2012, to manipulate the benchmark price in Britain used by the industry to influence a range of contracts.
But Ofgem said the unnamed sellers of the six lowball trades that day have given "credible" explanations to "demonstrate that their trading activity was not improper."
"No evidence was found which disputes the explanations provided," it said.
Ofgem added: "It has been concluded that no evidence of the alleged market manipulation could be found and therefore that the interests of consumers have not been harmed.
"Ofgem and the FCA always take seriously any allegation of market abuse in energy or financial markets and will consider carefully any evidence that is brought to our attention."
The watchdog said its probe was detailed, complex and time-consuming and included information analysis and face-to-face meetings.
Energy secretary Ed Davey said Ofgem and the FCA conducted a "rigorous review".
He said: "Market abuse is a very serious concern and I'm determined that where it exists, the full force of the law is brought to bear.
"That's why we're introducing annual competition reviews to make sure the energy market is operating properly, and we're proposing to introduce criminal sanctions for manipulation of the energy markets."
Downing Street said more competition was needed in the energy market and insisted that the Government's actions, including the possibility of criminal sanctions for price fixing, were the correct response.
"I think the FCA's review has been a rigorous one. What is certainly needed in the energy market is more competition," the Prime Minister's spokesman said.
"Looking forward to the future, of course, we have also said that we are proposing to introduce criminal sanctions for the manipulation of energy markets so that provision is available in the future."
He added: "Irrespective of whichever sector it may be, market abuse, market manipulation is a very serious issue and you would expect the Government to ensure that we have robust and tight legislative frameworks.
"You have seen us taking action not dissimilar to this in the financial sector. I think it is absolutely the right thing to do to bring forward the legislative ideas that we have."