Business environment Essay Example | Topics and Well Written Essays - 2000 words - 2

Business environment - Essay Example The pre-privatization organization of electricity in United Kingdom is symbolized by broad vertical integration of production, transmission, distribution and its supplication (DTI, 2006). For instance, the structure of nationalized industry in Wales and England was control by one huge production and Transmission Company called CEGB which sold electricity in mass to 12 area distribution boards. Each of them served a franchise or a closed supply area. In Scotland, existed two vertically integrated boards that practiced regional monopolies though they cooperated nearly in utilization of their producing plant into ensuring that the demand was catered as viewed in the figure below: One of electricity innovation sector at privatization was the building of electricity pool of Wales an England (DTI, 2006). The pool become one of initial mechanisms of its type and thus, there involved little experience on other countries to rely on its creation and regulations connected with it. In its establishment, considerable weight was offered to arrangements functioned pre-privatization by CEGB, the time when electricity system was publicly-owned and centrally organized. Electricity Association (2002), after the first increase in numbers of licensed electricity suppliers functioning in electricity supplying market, the modern increase in acquisition and merger practices proposes the trend toward consolidation of electricity supply market. Electricity Association (2002) points onto the lowering prices and relentless competition, since spurring on companies gets a chance of consolidation to ensure they become more competitive (Electricity Association, 2001). There has been the recent trend into integration of production and supplication in recent years. In July 1998, Powergen purchased East Midlands Electricity as National Power purchased Midlands Electricity supply business. After the National