Three major domestic energy suppliers have lost their high court challenge over the government’s handling of the sale of the collapsed energy firm Bulb.
Scottish Power, British Gas and E.ON claimed an “unfair sale process” led to decisions “to commit billions of pounds of taxpayer money to facilitate the acquisition of a failed business” by the rival firm Octopus Energy.
The three businesses brought legal action against the government, alleging its decision-making process was “flawed and unlawful”.
But in a ruling on Friday, Lord Justice Singh and Mr Justice Foxton rejected the legal challenge.
At a hearing in London last month, the judges were told that the handling of the sale allegedly prevented British Gas making a “better” offer that could have saved money for taxpayers.
British Gas’s legal team also claimed “the process by which the subsidy was granted was seriously lacking in transparency, openness, fairness and equal treatment”.
The energy companies challenged two decisions taken by the then Department for Business, Energy and Industrial Strategy (BEIS) in October and November: to approve the takeover and to provide “very substantial central Government funding” to help with the transfer.
The department’s lawyers said the claims against it were “without merit”, arguing that companies were aware they could seek government support.
They said the department made “rational” decisions after expert advice that Octopus’s offer represented “the value that the market is placing on Bulb in the current sector environment”.
Unwinding the sale now would be “liable to cause chaos”, the government’s lawyers warned.
Octopus argued its rivals’ complaints were a “rewriting of history” and that its purchase of Bulb would be “extremely
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