Gnergy may have licence revoked over unpaid RO

Challenger supplier Gnergy may have its licence revoked after failing to pay its outstanding renewables obligation (RO) payments, Ofgem has warned.

The regulator announced this morning (9 January) that it has issued Gnergy with a notice of failure to comply with a final order.

Utility Week reported yesterday that Gnergy was the sole remaining supplier to owe such payments, with the rest having either paid or ceased trading.

The final order was issued to the challenger brand in October over its failure to pay more than £673,800. Gnergy was listed by Ofgem in December as owing more than £680,000 in RO payments plus interest.

Ofgem said the Hampshire-based supplier was unable to give it any assurance it would meet its obligation.

As a result the regulator has started the process that may result in the revocation of Gnergy’s licence.

Breeze Energy, which owed more than £486,000, was issued with a provisional order in October. This supplier ceased trading in December, with British Gas taking on its customers.

In December Ofgem revealed that almost £100 million in RO payments were owed by energy suppliers, many of which had already left the market.

As a result mutualisation is to be triggered for the second time in as many years.

In line with the RO orders, suppliers who discharged part of all of their obligation will be contacted to make quarterly payments to make up the shortfall, in proportion to their obligation.

In total, the relevant shortfall is £97.5 million.

Ofgem is unable to pursue enforcement action against suppliers which ceased trading before obligations became due but has previously said that it will seek to recover outstanding payments through the organisations’ administrators “where appropriate”.