Investigation into SSE and its compliance with Article 14(1) of the Electricity and Gas (Community Energy Saving Programme) Order 2009

Opened:
Apr 2013
Decision Proposed:
Dec 2014
Closed:
Mar 2015
Company:
SSE
Regulation Area:
Sectoral Regulations

The Authority has decided to impose a financial penalty on SSE following an investigation into the company’s compliance with its obligations under Article 14(1) of the Electricity and Gas (Community Energy Saving Programme) Order 2009.

The Community Energy Saving Programme ("CESP") was a policy, set down in legislation, designed to improve domestic energy efficiency standards in the most deprived geographical areas across Great Britain. The relevant legislation was the Electricity and Gas (Community Energy Saving Programme) Order 2009 ("CESP Order"). Under Article 14(1) of the CESP Order, generators and suppliers had to achieve their carbon emissions reduction obligation by promoting qualifying actions to domestic energy users in low income areas.

The Authority found that SSE breached Article 14(1) of the CESP Order having failed to achieve its carbon emissions reduction obligations by promoting qualifying actions to domestic energy users by 31 December 2012. SSE as a whole delivered 90.9% of its obligation and had a shortfall of 252,168 tCO2. SSE’s shortfall as a percentage of its obligation (9.1%) was smaller than any other OP under CESP.

The particular SSE licensees which failed to meet their obligations were SSE Energy Supply Limited, Southern Electric Gas Ltd, SSEPG (Operations) Ltd, Medway Power Ltd, Keadby Generation Ltd, Greater Gabbard Offshore Windfarm Ltd, Uskmouth Power Company Ltd, Clyde Wind Farm (Scotland) Ltd and Griffin Wind Farm Ltd.

The Authority noted that SSE undertook mitigation activity by May 2013 to mitigate its carbon saving shortfall in full. SSE also over-delivered which resulted in 346 more households receiving measures. The Authority had regard to this in setting the final level of penalty.

A payment of £1.75 million (less a nominal £1 penalty on each of the SSE licensees) will be made by SSE to vulnerable consumers, through the Foundations Independent Living Trust, Energy Action Scotland and the Citizen’s Advice Bureau for use in Wales with the aim of pursuing the following objectives:

• promotion of carbon emissions reduction in domestic homes;

• the promotion of energy efficiency in domestic homes; or

• fuel poverty.

A financial penalty of £1 by each of the SSE licensees is to be made by 17 April 2015.