Discuss the findings of the OFGEM report with regards to the UK energy Coursework - 1

Discuss the findings of the OFGEM report with regards to the UK energy market; and discuss if more competition between the big six UK energy firms may benefit UK consumers - Coursework Example The UK energy market has never experienced stiff competition from either new or existing energy supplying firms. A critical analysis of the current level of competition in energy supply proves that it is harmful to the consumers. In essence, the current competition in the energy sector has increased the energy prices and led to additional expenses to consumers. The competition among the six major energy firms in the UK is unhealthy as far as consumer welfare is concerned. Competition in the UK energy market need to be increased in order to improve service delivery and reduce the energy prices. Rise in the level of competition in the energy industry would be of great importance to the consumers. Allen, Hammond, & McManus, (2008) states that the UK energy sector has experienced several changes in the past few years. The prices for electricity and gas have been on rise, with that of gas rising at a higher rate. A research conduct from 2011 to 2013 on domestic energy prices showed that the price levels have been on an increase with no signs of decrease. The energy expense has risen by over 4% in the past ten years. Consumers have to keep on adjusting their budgets to meet the ever increasing energy expense. As a result, some customers keep on switching from supplier to supplier for better deals. However, the rate at which consumers switch from one supplier to the other is very minute and, therefore has little influence on the annual energy consumption expense (Johansson et al., 2012) The UK government has established mechanisms to move to cleaner sources of energy. Use of energy sources such as gas, coal and nuclear power produce greenhouse gases that are destructive to the ozone layer. Research has shown that the increased production of greenhouse gases has contributed to climate change. For instance, over the past ten years, climate patterns have changed and become a little bit unpredictable. In order to control discharge of harmful