Lawsuit seeks compensation for millions of UK energy customers
Former Ofgas head Clare Spottiswode has teamed up with law firm Scott + Scott to file a blockbuster class action lawsuit at a London court, seeking hundreds of millions of pounds in compensation for domestic energy consumers.
Scott + Scott lodged the collective action at the Competition Appeal Tribunal (CTA), which is being brought against manufacturers of high-voltage power cables on behalf of millions of UK households, who allegedly paid inflated fees for electricity supplied via the distribution network after April 2001.
This follows the European Commission ruling eight years ago that a number of companies operated an almost-worldwide cartel for nearly a decade in the market for high voltage and submarine power cables.
As a result of the cartel’s activity, British energy suppliers potentially purchased high voltage power cables at an artificially inflated price.
With the expenditure passed onto consumers through Ofgem’s price control mechanisms, domestic electricity customers in the UK may have paid higher electricity bills than they otherwise would have done.
As the liability of the defendants has been established, the focus of the claim will be on proving the cartel caused higher prices for high voltage cables, and that these costs were passed on to consumers.
The power cable companies named as defendants in the claim include Nexans France SAS, NKT Verwaltungs GMBH, and Prysmian Cavi e Sistemi.
City PM has reached out to each company for comment.
Spottiswoode has applied to spearhead the action and will be considered by the court as a proposed class representative.
If approved, she could be responsible for overseeing the compensation payments to customers.
Speaking to City PM she said: “We will be making an estimate of what’s been overcharged to date, and what the charges will be in the years going forward. So it’s quite a complicated calculation. Of course, once we got to judgement, we’ve got to work out how to divide it between everyone.”
No compensation amount has yet been agreed, and the newspaper understands the process could take up to 18 months.