Ofgem minded to allow ScottishPower to claim £10.6m

The amount is for the costs incurred in acting as a supplier of last resort for Extra Energy

Ofgem has said it is minded to allow ScottishPower to claim up to £10.6 million for costs incurred in acting as a supplier of last resort (SoLR) to former customers of failed supplier Extra Energy.

ScottishPower had given notice to the regulator of its intention to submit a claim of a last resort supply payment of up to £13.6 million.

It was chosen by the regulator to take on the 108,000 domestic customers and 21,000 business customers of Extra Energy after it ceased trading in November 2018.

An SoLR can make a claim for Last Resort Supply Payment (LRSP) from relevant distribution networks if granted consent to the amount claimed.

Lesley Nugent, Deputy Director, Retail Directorate said: “In the period between being appointed as SoLR and recovering the costs to which we consent, ScottishPower will have incurred costs in making capital available to fund the costs associated with the SoLR process. ScottishPower set out in their SoLR submission that they expected their claim for a LRSP to include these costs.

“We are minded-to agree that the methodology used to calculate this element of the claim is appropriate.”

Ofgem is now consulting on its proposal and expects to make a final decision in January 2021.

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