Watchdog delays launch of open power market

The introduction of competition into the UK electricity market has been delayed due to computer problems, the industry watchdog has announced.

Offer, the Office of Electricity Regulation, has pulled the plug on a planned April 1998 launch date, adding that September now appears to be a more realistic deadline.

The decision to put back the launch follows a review of the programme by PA Consulting, which was called in by the director-general of electricity supply, Prof Stephen Littlechild.

Changes needed in computer systems

Its report has identified slower-than-expected national testing of IT systems, which are being designed to prepare power companies for the demands of a more open market.

The report found that there has been "substantial progress" in the programme, but also a significant delay in resolving some industry design issues, Littlechild said.

A number of detailed changes are now required to enable company IT systems to integrate properly with each other, he said.

Prof Littlechild said: "It is clear that the industry will not be ready to implement the necessary changes to ensure that competition can be introduced in April in a satisfactory manner."

"Introducing competition for 26 million electricity customers involves a very major programme of work across the whole industry."

The move involved one of the biggest overhauls of computer technology systems in the world.

Minimising disruption to consumers

PA Consulting has advised that a five-month delay will provide sufficient time to complete the remaining work in an orderly manner consistent not just with the early introduction of competition but also with ensuring that the risks of disruption to customers arising from the changes are minimised.

In each area, a controlled market start-up of six months is planned, he said, adding that this means the market will be fully open with all customers having access to competition by June 1999.

Officials from Offer are to meet Government representatives this week to hold more talks about the delay.