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Britain’s Ofgem to consult on REMIT guidance

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British energy regulator Ofgem has said it will consult on changing its procedural guidelines and how it calculates penalties for breaches of REMIT. The consultation is slated for October. This comes around the same time the UK energy minister flagged his intention to introduce criminal penalties for energy market abuse . The criminal sanctions for market manipulation or insider trading are set to come in place in the spring of 2015.

The UK government thinks introducing the possibility of jail time for REMIT-type breaches is necessary, to align the regulation with UK financial services regime, which already has criminal sanctions for market abuse.

The introduction of criminal sanctions is significant, even for those based outside the country, because of the amount of trade brokered in London and London-based platforms. This means a significant chunk of European gas and power markets will be captured by the regime if and when it comes in.