Ofgem fines British Gas £11m for failing efficiency obligations

Ofgem will force British Gas to payout £11.1 million to vulnerable energy users after the supplier failed to meet mandatory targets to improve the energy efficiency of its customers’ homes.

Ofgem said on Thursday that it is “unacceptable” that the supplier achieved just 62.4 per cent of its obligations under the Community Energy Saving Programme (Cesp) scheme by the December 2012 deadline.

“This led to around 6,750 households in low income areas experiencing delays in receiving energy saving measures which would have helped keep homes warm and lower bills during the winter of 2012/13,” Ofgem said.

However, the supplier performed better on its Carbon Emission Reduction Target (Cert) obligations, achieving 99 per cent by the deadline, and completed both the Cert and Cesp targets by February and August 2013 respectively.

Eventually British Gas over-delivered by 2.3 per cent for Cert and 1.5 per cent for Cesp, which saw around an additional 20,000 homes benefiting, Ofgem said.

“The payment reflects British Gas’ failure to meet its obligations on time but also recognises its commitment to put things right,” said Ofgem’s senior partner Sarah Harrison.

The £11.1 million payout pales in comparison to the £28 million leveled against Drax last week over the same schemes. Ofgem has also identified SSE, Scottish Power, GDF Suez and Intergen as failing to meet the efficiency obligations.

British Gas managing director of new energy Claire Miles said the company is “sorry” to have missed Ofgem’s deadlines, “however, we’re pleased that in the end we managed to help more vulnerable people under this scheme than was required.”

British Gas and Ofgem are currently in talks about how best to ensure the £11.1 million benefits vulnerable consumers. One option under consideration is via the British Gas Energy Trust, Ofgem said.