E.ON Next finalized its purchase of Ovo Energy on Thursday following clearance from Britain’s competition authority, a transaction that reshapes the country’s household energy supply landscape. The combined entity will serve approximately 13.45 million gas and electricity accounts, representing 25% of the market and positioning E.ON Next as the second-largest supplier in Great Britain.
Octopus Energy maintains the leading position with 26% market share and 14.3 million accounts, while British Gas holds third place with 23% of the market or 12.5 million accounts. This consolidation means that three suppliers now control nearly 75% of the household energy market. When five major suppliers are considered—adding EDF Energy and Scottish Power—their combined share reaches approximately 90% of Great Britain’s residential energy supply sector. The four million Ovo customers will experience no immediate changes following the acquisition.
The deal represents a significant setback for efforts launched over the preceding decade to reduce the dominance of large suppliers and foster competition. Industry analysts note that the landscape has shifted dramatically from 2016, when the Competition and Markets Authority investigated the “Big Six” suppliers and found customers were overpaying between £1.4 billion and £1.7 billion annually due to insufficient competition. That period saw the six legacy suppliers control approximately 85% of the market.
While market disruption since 2016 initially spawned numerous new entrants including Octopus, Ovo, and Bulb Energy, the sector subsequently contracted significantly. A 2019 sale by SSE of its household supply business to Ovo preceded a broader market contraction during the 2021-22 energy crisis, when dozens of suppliers ceased operations. Bulb Energy’s 2022 collapse marked a major casualty, with Octopus absorbing 1.5 million of its customers.
E.ON’s leadership characterized the market as intensely competitive and emphasized the company’s capacity to deliver value through scale and flexibility. However, industry observers raised concerns that reduced supplier numbers may diminish competitive pressure to maintain low prices and offer differentiated services, despite acknowledging that larger suppliers provide market stability following the previous wave of small-firm failures.
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