Ofgem orders four energy suppliers to pay £14.7m in green taxes

The regulator said Delta Gas and Power, GnERGY, Robin Hood Energy and Toto Energy could lose their licence if the Renewables Obligation payments are not made

Ofgem has ordered four energy suppliers to pay a total of £14.7 million in outstanding payments to comply with a government scheme that supports renewable energy.

The regulator said Delta Gas and Power, GnERGY, Robin Hood Energy and TOTO Energy missed a deadline last month to comply with the Renewables Obligation (RO) scheme, under which suppliers must demonstrate they have sourced enough electricity from green sources.

They had to do so by presenting Renewables Obligation Certificates (ROCs) to Ofgem by 1st September and if they did not have enough ROCs, they had to make up the shortfall by paying into a buy-out fund by 31st August.

The outstanding amounts are as follows:

  • Delta Gas and Power Ltd: £91,937
  • Gnergy Ltd: £637,876
  • Robin Hood Energy Ltd: £9,435,925
  • Toto Energy Ltd: £4,555,880

Ofgem said the four suppliers failed to pay into the buy-out fund or present the required number of ROCs by the deadlines and now have until 31st October 2019 to make the outstanding payments with interest.

The regulator added it will take “appropriate enforcement action” against the companies if they fail to comply.

Mary Starks, Executive Director of Consumer 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.”

Responses

A spokesperson from Robin Hood Energy, owned by Nottingham City Council said: “We arranged a meeting in August to discuss this matter with Ofgem and were advised that as long as our Renewable Obligation Certificate (ROCs) payment is made by March 2020, which we have always planned to do, then this matter will be resolved.”

In response, Ofgem said it has been working with all suppliers that have so far failed to comply with the RO “and reiterated to them all the importance of making the payment by 31 October, the deadline set out in legislation”.

A spokesperson from GnERGY told ELN: “When it comes ROC, the fact is that Ofgem expects us to pay on behalf of our customers who have not paid us. While we are obligated to offer payment plans to our customers, the same does not apply when it comes to Ofgem.

“This defeats the purpose of competition and encouragement to join the industry, hence the Big Six will always dominate.”

A TOTO Energy spokesperson added: “We regret Ofgem’s decision to issue this consultation at this time. We disagree with the reasons for their decision. We remain committed to meeting our all of our obligations and continuing to deliver excellent service to our customers.”

ELN has contacted Delta Gas and Power for a statement.

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