British Gas fined over £11 million for missed deadlines

4th December 2014

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Joss Watson

Energy regulator Ofgem has fined British Gas £11.1 million for failing to improve energy efficiency in enough low-income households.

The energy company was fined £10.6 million delivering less than two-thirds (62.4%) of its target under the community energy saving programme (CESP) by the end of 2012 deadline.

It was fined a further £500,000 for marginally failing to meet its target on the carbon emissions reduction target (CERT). The company achieved 99% of its CERT target by the end of 2012.

Both programmes required energy suppliers and generators to achieve targets for reducing carbon emissions from domestic properties by fitting energy efficiency measures, such as insulation, with CESP focussing in particular on low-income households.

British Gas eventually reached its CERT target in February 2013 and the CESP goal six months later, in August. According to Ofgem, the company over-delivered on CERT by 2.3% and on CESP by 1.5%, benefitting around 20,000 extra homes.

But the regulator said that the CESP target had been achieved “particularly late” and this was one of the key factors in the level of fine imposed. Ofgem accused senior management at British Gas of not taking sufficient action to manage delivery of the programme when problems arose in 2012.

Sarah Harrison, Ofgem’s senior enforcement partner, said: “British Gas’ failure to deliver two environmental obligations on time is unacceptable. Thousands of households had to wait for energy efficiency measures, like insulation, to be installed during the winter.”

The fines will pay for further energy efficiency measures to those in fuel poverty, Ofgem said.

British Gas said it was sorry to have missed the deadline. Claire Miles, managing director of British Gas new energy, commented: “We’re pleased that in the end we managed to help more vulnerable people under this scheme than was required. The donation we’re making will further help those struggling to keep their homes warm.”

British Gas cited poor weather in 2012 as one of the reasons for missing the deadlines. Solid-wall insulation cannot be installed in temperatures below 5°C, while long periods of wet and windy weather mean work could not be carried out safely, it said.

Earlier this week, Ofgem fined Drax Power and Intergen a total of £39 million for missing targets under CESP. Scottish Power, SSE and GDF remain under investigation for failing to meet their targets.

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