Delta Gas and Power Ltd: Provisional Order November 2022

Orders
  • Open - Provisional Order issued
  • Provisional Order confirmed
  • Decision Proposed - Confirm Provisional Order
  • Decision Proposed - Revoke Provisional Order
  • Notice to rectify
  • Notice to revoke licence
  • Closed

Publication date

Company

Industry sector

Supply and Retail Market

On 7 November 2022, the Authority issued a provisional order to Delta Gas and Power Ltd (“Delta”) in accordance with section 25(2) of the Electricity Act 1989 (“EA89”) and 28(2) of the Gas Act 1986 “GA86.”

The Authority considers that Delta is contravening or is likely to contravene Standard Licence Conditions (SLC)s 4A (Operational Capability Principle) and 4B (Financial Responsibility Principle).

The particular areas of concern giving rise to the making of the provisional order are that Delta:

  • Does not appear to have the capability to comply with its relevant legislative and regulatory obligations
  • Is not able to responsibly manage its costs at risk of being mutualised and does not have adequate arrangements in place to meet those costs because:
    • It does not appear to have adequate financial arrangements in place to operate effectively under the stress-test scenarios set by the Authority
    • It does not appear to have adequate hedging in place at a time of volatile wholesale energy prices

The provisional order requires Delta to address our concerns immediately and fully. Until such time, the provisional order bans Delta from taking on any new customers and removing any money from the business unless it constitutes spending essential to the operation of Delta’s supply business.

Further details of what Delta is required to do, and by when, are contained in the order itself and the Notice of Reasons, below.

Provisional orders are issued in certain circumstances in accordance with the EA89 or GA86 and where certain conditions are satisfied. Further information regarding provisional orders is contained within our Enforcement Guidelines.