E.ON Next finalized its takeover of Ovo Energy on Thursday following approval from Britain’s competition regulator, consolidating further control of the country’s household energy supply sector. The transaction gives E.ON Next 25% of the market share with 13.45 million gas and electricity accounts, positioning it as the second-largest supplier behind Octopus Energy, which holds 26% of the market, and ahead of British Gas at 23%.
The deal marks a significant shift in the competitive landscape of British energy supply. When five major suppliers—Octopus, E.ON Next, British Gas, EDF Energy, and Scottish Power—are combined, they will control approximately 90% of the household energy market. This consolidation represents a departure from earlier efforts to increase competition and reduce consumer bills following a 2016 investigation that found customers were potentially overpaying billions annually due to weak market competition.
The energy sector has undergone substantial transformation over the past decade. The original “Big Six” suppliers dominated approximately 85% of the market in 2016, but subsequent developments reshaped the industry. A wave of new competitors emerged after that investigation, though the 2021-22 energy crisis triggered multiple business failures. Dozens of suppliers ceased operations, with Bulb Energy becoming a notable casualty when it entered administration, and its customers were absorbed by Octopus.
Industry observers noted both risks and benefits associated with the consolidation. While larger suppliers provide operational stability following the recent period of market instability, concerns persist about reduced competitive pressure on pricing and service offerings. Analysts emphasized that the upcoming years will be crucial in determining whether households shopping for better deals will find genuinely differentiated options or merely variations of similar products from the dominant three suppliers.
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