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Ofgem review welcomed

19/05/2011

The energy regulator Ofgem must be more accountable to Scotland, First Minister Alex Salmond said today.

The First Minister welcomed the publication of the UK Government's review of Ofgem and said that the Scottish Government and Scottish Parliament must be able to shape the regulator's direction and hold it to account for its decisions.

Mr Salmond said:

"We have long pressed for a regulatory framework that helps Scotland deliver its vast low carbon energy potential. I am pleased that the UK Government today recognises that Ofgem should be directed by government to work towards the delivery of energy policies.

"That must mean Scotland's ambitious renewables and clean energy policies being explicitly included in Ofgem's direction. We lead the UK in producing onshore green energy, in developing a world leading offshore and marine renewables industry and in having the most ambitious renewable energy targets. I therefore want Scottish Ministers to be involved in drafting the proposed new Strategy and Policy Statement which sets the regulator's direction.

"I have also argued that the regulator should be required to explain its decision-making, be exposed to greater scrutiny and be challenged by Parliament. That means Ofgem should be mandated to explain its decisions and report annually on progress to the Scottish Parliament as well as the UK Parliament - only then would we be able to ensure that Ofgem is genuinely supporting the low carbon, sustainable energy future that Scotland is seeking."

The Scottish Government will now work with the UK Government to reflect these aims in the relevant clauses in the forthcoming UK Energy Bill.

The Department of Energy and Climate Change launched a review of the roles and purpose of Ofgem in July 2010 to explore whether any changes are needed to the regulatory framework to enable the UK Government to achieve its energy and climate change goals. The Scottish Government submitted evidence to the review in September 2010.