Three energy suppliers face losing licences over £15m unpaid green taxes
The energy regulator has issued three final orders for £15 million in unpaid fees for renewable energy programmes and warned it could strip the offending suppliers of their licences if they do not pay up.
Ofgem said Renewables Obligation (RO) fees are owed by Nabuh Energy, Robin Hood Energy and Symbio Energy, with all three unable to provide adequate assurances that they will make the payments by a final deadline on October 31.
An original deadline at the end of September was breached by seven suppliers owing a combined £33.86 million, with Ofgem saying Co-Operative Energy and Flow Energy have now given suitable assurances, MA Energy has paid up in full, and Tonik Energy went bust.
The regulator said: “If suppliers fail to make the payments, Ofgem could take further enforcement action which could include revoking a supplier’s licence.”
Robin Hood Energy owes the most under the RO, which is a green tax charged to customers and subsequently supposed to be handed to Ofgem, with £12 million outstanding.
The company had been hailed as a new kind of supplier, operating as a not-for-profit enterprise, but the huge costs in launching an energy firm quickly overwhelmed the council-backed business.
It went bust last month with auditors Grant Thornton calculating that Nottingham City Council invested £43 million into the company and risked £16.5 million in guarantees. British Gas took on the firm’s customers following the collapse.
In a report, Grant Thornton accused the council of “institutional blindness” with a determination that the company “should be a success”, despite missing payment deadlines and racking up losses.
The Government’s RO schemes require suppliers to show they have sourced enough electricity from renewable sources to meet their own specific obligation.
Ofgem said suppliers had to present this information by September 1, with those firms which failed to fulfil their obligations having to make up the shortfall in meeting renewables targets by paying into a fund.
Suppliers who fail to pay in full by the original deadline must pay with interest by the end of October.
Robin Hood Energy also failed to pay its Feed-in Tariff (Fit) levelisation payments.
The Fit scheme provides payments to owners of small-scale renewable generators, such as solar panels on homes, and is funded through levies on suppliers.
Cathryn Scott, Ofgem’s director of enforcement and emerging issues, said: “The Renewables Obligation and Feed-in Tariff schemes provide vital support to renewable electricity generators and play an important role in Great Britain’s journey to a greener, fairer energy system.
“This enforcement action shows that we will take robust action if suppliers undermine such schemes by failing to meet their obligations, which could lead to them having their licence revoked.”
Nabuh Energy owes Ofgem £2.68 million and Symbio Energy owes £506,308, according to the watchdog.