Emissions & Environment, Europe, Renewables, Strategic Development

UK suppliers named for not meeting RE obligations

Ofgem sign

UK regulator Ofgem is consulting on issuing four suppliers with final orders to compel them to settle amounts owing and comply with the Renewables Obligations schemes by 31 October 2019. The fines will amount to £14.7m ($18m)

The suppliers are:

  • Delta Gas and Power Ltd – outstanding amount: £91,937 ($113,000)
  • Gnergy Ltd – outstanding amount: £637,876 ($784,000)
  • Robin Hood Energy Ltd – outstanding amount: £9,435,925 ($11.6m)
  • Toto Energy Ltd – outstanding amount: £4,555,880 ($6.83m)

Under the governments’ Renewables Obligation schemes, suppliers must demonstrate they have sourced sufficient electricity from renewable sources to meet their obligation by presenting Renewables Obligation Certificates (ROCs) to Ofgem by 1 September.

If suppliers do not have enough ROCs to meet their obligation, they must make up the shortfall by paying into a buy-out fund administered by Ofgem by 31 August.

The four suppliers have failed to meet their ROC obligation, pay into the buy-out fund or present the required number of ROCs by the 31 August and 1 September 2019 deadlines. They have until 31 October 2019 late payment deadline to make the outstanding payments, plus interest.

Ofgem has engaged with all suppliers that missed the 31 August and 1 September deadlines to seek assurances that they will be in a position to make the necessary payments by the late payment deadline.

The named suppliers failed to provide satisfactory assurances and Ofgem believes that they are likely to breach their obligations.

If the final orders are confirmed later this month, the suppliers will be compelled to pay into the buy-out fund by the 31 October. If they do not, Ofgem could start the process of revoking their licence to supply energy.

Other suppliers missed the 31 August deadline but have given satisfactory assurances to Ofgem on meeting their obligations.

Mary Starks, executive director of consumers and markets said: “The Renewables Obligation schemes provide important support to renewable electricity generators and play an important role in Great Britain’s journey to a net zero emission economy by 2050.

“Supplier failure to comply with the schemes undermines the integrity of the schemes and is unacceptable. It also adds to the costs of other suppliers who do meet their obligations as they have to absorb or make up any shortfall.

“This enforcement action sends a strong signal that suppliers must meet their obligations, or pay the consequences which could mean losing their licence.”