OFGEM CUT OF 20% INVESTMENT IN GAS DISTRIBUTION WILL LEAD TO 3,000 JOB LOSSES AND LIVES LOST IN GAS EXPLOSIONS WARNS GMB

Phil Black - PII Editor 28/02/2013

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OFGEM must go and a system of regulation introduced that ensures customers don”t get ripped off but there is also sufficient investment in capacity, jobs, skills and safety to keep the country safe and warm says GMB

GMB, the union for energy workers, commented on the announcement by National Grid that the Board had accepted Ofgem’s RIIO Final Proposals in full. See notes to editors 1for National Grid announcement and for details on RIIO.

Gary Smith GMB National Secretary for Energy and Utilities said “This decision was inevitable from National Grid. The other gas distribution companies will be compelled to comply too (Wales and West Utilities, SGN, Northern Gas networks – see note 2 below). It would be too big a gamble to do anything else.

However, what this means in real terms is that 3,000 jobs will go across the gas sector and gas mains replacement programme which is about safety will be slashed.

Less investment will give rise to a less safe gas industry and not a penny off people”s bills.

This 20% cut in investment by OFGEM will cause more gas leaks. Ofgem’s RIIO formula takes no account whatsoever of the dangers in handling the volatile and highly explosive substance. See criteria in note to editors 3 below. Gas main replacement will be cut and gas workers aren”t going to be able to cope with gas escapes if it gets cold. An increased risk of loss of life as a direct result is inevitable.

OFGEM has failed. It must go and a system of regulation introduced that focuses on making sure customers don”t get ripped off but there is also sufficient levels of investment in capacity, jobs, skills and safety to keep the country safe and warm”