The U.K. competition watchdog agency approved the proposed merger between the retail businesses of energy providers SSE PLC and NPower.

The inquiry by the Competition and Markets Authority, or CMA, focused on the deal's effect on residential households and concluded the two energy providers do not compete closely on standard variable tariffs, or SVTs, so the merger would not have much impact on those prices, according to an Oct. 10 release.

The approval follows an Aug. 30 provisional approval and will unite SSE Energy Services Group Ltd. and NPower, a subsidiary of German utility Innogy SE.

"Following a thorough investigation and consultation, we are confident that SSE and Npower are not close rivals for these customers and so the deal will not change how they set SVT prices," Anne Lambert, chair of the inquiry group, said in a news release.

Additionally, the CMA expects Ofgem's, the U.K.'s Office of Gas and Electricity Markets, upcoming price cap on standard variable and default energy tariffs to further protect customers until at least 2020.