Ovo Energy will pay £1.2 million in penalties for SSE’s failure to hit targets for installing smart meters last year.
Fast-growing supplier Ovo acquired the Big Six firm’s domestic supply business, SSE Energy Services, in a £500 million deal in January. It’s therefore left holding the bill for SSE’s inadequate smart meter rollout.
Large energy suppliers have annual targets for installing the next-generation gas and electricity meters, monitored by the energy regulator Ofgem, as part of the government’s plan to offer these meters to all homes and small businesses by June 2025, a deadline which has twice been pushed back.
SSE missed its targets for installing smart meters in 2018 and paid £700,000 into a voluntary redress fund in April last year to avoid enforcement action by Ofgem. Its rollout was also subpar in 2019, and Ovo will now pay £1.2 million into the fund for the failings.
SSE said it had improved its smart meter procedures since being acquired by Ovo.
SSE Energy services managing director Tony Keeling said: “Today’s news relates to the reporting year of 2019, predating Ovo Energy’s ownership of SSE Energy Services, which it acquired in 2020.
“Since Ovo’s acquisition of SSE Energy Services, we have significantly improved our smart meter roll-out programme, to ensure that we can install smart meters in more homes across the UK – a crucial part of our Plan Zero strategy and the transition to net zero.
“Ovo Energy has consistently met and exceeded all of its smart meter targets, with over half of its customers currently benefiting from the technology.”
The voluntary redress fund, administered by the Energy Saving Trust, distributes money to charities in England and Wales supporting energy customers in vulnerable situations and the development of innovative energy products and services.
In June, the government let suppliers off their 2020 targets for installations, which were suspended during the coronavirus lockdown. They have now been given until June next year to meet their supply licence requirement to “take all reasonable steps” to provide smart meters to all homes and small businesses.
13.6 million smart meters have been installed in UK homes and businesses since the rollout began in January 2012. Installations jumped 120% between June and July, as suppliers resumed home visits.
In May, Ovo announced that it would slash 2,600 jobs, 80% of them from its SSE division, after the coronavirus pandemic accelerated the shift to online customer service. Ovo is the UK’s second-largest energy supplier, with five million accounts.