First Utility and Ovo Energy Criticise Labour Energy Proposals

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A number of small energy suppliers have joined in the criticism of Ed Miliband's  proposed price freeze.

The proposal has already drawn criticism from big six energy suppliers, British Gas and nPower, and now First Utility and Ovo Energy have moved to blast it.

Labour said it would freeze gas and electricity prices for a period lasting 20 months if it won the 2015 election, last week.

Chief executive at First Utility, Ian McCaig, stated: "A policy like this is potentially problematic for an independent provider.

"Bluntly, it could put me under," before adding: "How am I going to absorb those costs? I only retail, I don't generate. The answer is, I can't."

McCaig revealed that he had requested a meeting with the Labour party, and said he was willing to work them to determine alternative ways of dealing with issues in the energy market.

Ovo Energy's managing director, Stephen Fitzpatrick, said similarly: "While this sounds simple, it's not what the market needs.

"I don't think politicians setting energy prices is going to work. There are a lot of issues around it.

"It's not going to help consumers. They need more competition. What's going to happen after the price freeze?"

He then went onto add: "Without effective competition you will never get lower energy prices."

"We need more effective regulation, not government intervention," McCaig concluded.

Some small energy suppliers are partaking in the Government's Green Deal.

The Green Deal is an initiative which allows homeowners to apply for funding for energy efficiency home improvement measures - like the installation of a new gas boiler, or cavity wall insulation, for example.

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