ABSTRACT
For England and Wales, whch make up the vast majority of the UK electricity supply industry, a major feature of privatization was the separation of supply, distribution, transmission and generation into separate businesses, although supply and distribution both stayed w i t h the ownershp of the 12 RECs. The main purpose of this reorganization was to separate the management of those activities which were effectively 'natural monopolies' (distribution and transmission) from supply and generation which could be made competitive. It was recognized that the 'natural monopolies' would require regulation for the foreseeable future; but for supply and generation, the regulator was charged among other things with promoting competition. For these activities any regulation was regarded as merely transitional, until such times as full and effective competition had been established.
