Scottish and Southern Energy Power Distribution pay £750,000 for not providing timely offers to connect some customers to the electricity network
30 May 2014 12:58 PM
• Ofgem found Scottish and Southern
Energy Power Distribution (SSEPD) were too slow in providing connection offers
to some customers
• SSEPD to give money to a community trust to assist electricity
connections in rural areas
• SSEPD has cooperated fully with Ofgem in looking into this
issue
Ofgem found that SSEPD did not provide some customers
with an offer to connect to the electricity network within the prescribed
timescales. In recognition of these failures, the company has paid
£750,000 to the Scottish Hydro Electric Community Trust, to assist
customers with the cost of electricity connections in rural
areas.
During routine monitoring, SSEPD and Ofgem found that
between August 2010 and September 2013 SSEPD did not meet the deadline to make
a connection offer to 200 customers. As part of their licence conditions,
electricity distribution companies have a maximum of three months to make
connection offers to customers and must have the appropriate resources in place
to deliver their work.
SSEPD was fined £500,000 by Ofgem in 2011 for
breaches of the same licence conditions. They committed, at that time, to
putting systems in place avoid a similar situation but these systems have been
shown to have flaws. Today’s higher payment takes into account the
failure to fully rectify the 2011 breach and the subsequent repeat of the same
breach.
As
well as providing an essential service to consumers, timely and cost-effective
connections to the distribution system enable economic growth and help to
decarbonise the energy we use. For the next electricity distribution price
control, RIIO-ED1, Ofgem has included a time to connect incentive for companies
to speed up time between application and connection offer.
Sarah Harrison, Ofgem Senior Partner with
responsibility for enforcement said: “We welcome
SSEPD’s admission that it breached Ofgem rules.
“Today’s announcement sends a clear message
to electricity distribution companies that they must help customers to connect
to their network in a timely and efficient manner.”
Ofgem takes strong action when companies fail to comply
with their licence conditions having issued over £100m fines since
2010.
<Ends>
Notes to editors
1. About the case
This case relates to two Standard Distribution Licence
Conditions (SLC):
• SLC 12 requires licensees to make a
connection offer “as soon as reasonably practicable…and in any
event within 3 months”
• SLC 30 requires licensees to ensure they have the necessary
resources to meet all licence conditions.
SSEPD failed to reach the three month deadline 200 times
between August 2010 and September 2013. 140 of the cases were by the
company’s Scottish Hydro Electric Power Distribution (SHEPD) arm and 60
by Southern Electric Power Distribution (SEPD). SSEPD made over 90,000
connection offers in that period.
2. About Ofgem
Ofgem is the Office of the Gas and Electricity Markets,
which supports the Gas and Electricity Markets Authority, the regulator of the
gas and electricity industries in Great Britain. The Authority's functions
are set out mainly in the Gas Act 1986, the Electricity Act 1989, the
Competition Act 1998, the Utilities Act 2000, and the Energy Acts as well as
arising from directly effective European Community legislation . In this note,
the functions of the Authority under all the relevant Acts are, for simplicity,
described as the functions of Ofgem.
3. For further press information please
contact:
Lisa O’Brien: 0207 901
7426
Dafydd Wyn: 020 3263 9943
Felicity Beverley: 0207 901 3858
Out of hours media contact number: 07766
511470