Ofgem has issued Delta Gas and Power, Gnergy, Robin Hood Energy and Toto Energy with final orders to compel them to make £14.7 million in outstanding payments they owe to comply with the Renewables Obligations schemes within the month.
The payments to be made by 31 October are:
- Delta Gas and Power: £91,937
- Gnergy Ltd: £637,876
- Robin Hood Energy Ltd: £9,435,925
- Toto Energy Ltd: £4,555,880
Suppliers have to demonstrate they have sourced enough 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 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.
If the final orders are confirmed later this month, and the suppliers do not make the payments, Ofgem could start the process of revoking their licence to supply energy.
But Robin Hood Energy says it has been in negotiations with Ofgem since August over a phased payment plan. It says, “A number of companies paid last year via installments and this was our proposal to Ofgem in September. We will be making our ROCs payments to Ofgem in full and we will be doing that in monthly installments starting in October. This means that as a business we are in a robust and stable position to continue to grow.” Read Robin Hood Energy’s full response here
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: “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.”
Gillian Guy, chief executive of Citizens Advice, said: “When energy suppliers fail to pay their bills, it’s customers who end up picking up the tab through higher bills of their own. This is not a new problem. Last year less than half of the initial unpaid Renewables Obligation (RO) was ever paid back.
“Energy suppliers should not be allowed to build up these levels of debt in the first place. The government needs to bring in legislation to require companies to make industry payments – including ROs – more regularly. This would limit the cost to customers when suppliers fail to pay or exit the market.”