Power distributor National Grid has been fined £41.6 million for restricting competition in the UK's gas metering market.

Energy regulator Ofgem said the company, which owns 99% of the UK's gas meters, had "severely restricted" rival suppliers from replacing its equipment with cheaper or more advanced devices.

Ofgem Chairman Sir John Mogg said: "National Grid has abused its dominance in the domestic gas metering market, restricting competition and harming consumers."

-- Advertisement --

National Grid bosses said they were "extremely disappointed" with the decision relating to the metering contracts entered into with gas suppliers in 2004.

"We are convinced that the contracts do not infringe competition law and therefore believe that they should remain in full effect," it said.

The company also believes the fine is "wholly inappropriate" and will be lodging an appeal with the Competition Appeal Tribunal.

National Grid's Chief Executive, Steve Holliday, said: "National Grid has been instrumental in helping Ofgem to develop competition in the UK metering industry, and we strongly believe we have never acted anti-competitively in the development of our contracts."

(CD/JM)