- Symbio Energy made four late payments into environmental schemes, only paying up in response to Ofgem’s threatened or commenced enforcement action.
- Other suppliers paid on time despite the difficulties caused by Covid-19
- This proposed fine sends out a strong message that every supplier must pay into these crucial environmental schemes on time, or face tough action
Ofgem proposes to fine Symbio Energy £100,000, reduced to £85,000 if Symbio agrees to settle, for making four late payments into Government renewables schemes, including Feed-in Tariff (FIT) payments and the Renewables Obligation (RO) scheme.
Last year, Symbio Energy missed obligatory deadlines to pay into the RO scheme buy-out fund or present a required number of Renewables Obligation Certificates (ROCs) by the initial deadlines of 31 August and 1 September 2020. It then missed the 31 October late payment deadline by a fortnight, making payment on 13 November.
Symbio Energy also missed three other payment deadlines over a four-month period for the government’s environmental schemes. This includes one RO mutualisation payment, which suppliers must make to cover the shortfall in the previous year. It also includes two FIT quarterly levelisation payments, which pays owners of small-scale renewable generators and is funded through levies on suppliers.
Senior management were aware that the company was breaking rules by missing payment deadlines and did not prevent the rule-breaking from taking place.
While Ofgem acknowledges the financial impact of the Covid-19 pandemic on suppliers, other suppliers have gone to considerable lengths to pay on time. It is the supplier’s responsibility to be aware of its upcoming liabilities and to ensure it is in a position to meet them. The Authority also notes the detrimental impacts of suppliers paying late on compliant suppliers.
Symbio Energy has since made all payments, which totalled around £1.2 million.
Cathryn Scott, Ofgem’s Director of Enforcement and Emerging Issues, said:
“Schemes like the Renewables Obligation and Feed-in Tariff provide vital support to renewable electricity generators and are crucial to building a green energy system, helping Britain hit Government net zero carbon emissions targets.
“Suppliers that do not make payments on time undermine the integrity of these schemes, gain unfairly financially, and ultimately leave consumers and other suppliers to pick up the tab.
“This proposed fine sends a strong message that Ofgem will not tolerate suppliers who do not meet their obligations around paying into these schemes and that growth cannot be at the expense of meeting regulatory obligations.”
Notes to editors
Read more about Ofgem’s investigation.
- The Renewables Obligation schemes are government schemes in Great Britain and Northern Ireland to support large-scale renewable electricity projects in the UK. They place an obligation on UK electricity suppliers to source an increasing proportion of the electricity they supply from renewable sources. Ofgem administers the schemes on behalf of government.
- ROCs are certificates issued to operators of accredited renewable generating stations for the eligible renewable electricity they generate. Operators can trade ROCs with other parties. ROCs are ultimately used by suppliers to demonstrate that they have met their obligations.
- Shortfalls in the late payment fund for the Renewables Obligation scheme will trigger mutualisation if the relevant threshold (£15.4 million for England and Wales, and £1.54 million for Scotland) is met. This means that suppliers who have complied with their obligations will be required to make up the shortfall.
- The Feed-in Tariffs scheme is a government programme designed to promote the uptake of smaller scale renewable and low-carbon electricity generation. It requires participating electricity suppliers to make payments on both generation and export from eligible installations. Ofgem administers the scheme on behalf of government.
- The FIT levelisation process is the mechanism by which the cost of the FIT scheme is apportioned across Licensed Electricity Suppliers. The cost is apportioned based on each supplier's share of the Great Britain electricity market, whilst taking into account any payments they have made to FIT generators.
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