Utilita Energy will pay £175k for failing to meet its carbon emission reduction obligations.
The regulator said the energy supplier failed to meet its obligations under the second iteration of the Energy Company Obligation (ECO2) scheme, which ran between April 2015 and September 2018.
The ECO is a government energy efficiency scheme that requires medium and large energy companies assist vulnerable energy consumers in keeping their homes warm and reducing their emissions. This entails providing financial assistance for the installation of energy efficiency measures, including installing insulation, double glazing, and new or more efficient boilers.
Under the current iteration of the ECO, suppliers with more than 250,000 domestic accounts which supply more than 500GWh of electricity and 1,400GWh of gas to those customers each year are required to participate in the scheme. Obligated companies are assigned a target by Ofgem, based on their share of the domestic energy market.
Utilita missed by 2% its overall target under the Carbon Emissions Reduction Obligation (CERO) to reduce carbon emissions from the homes it supplies. It also missed two sub-obligations: by 20%, its target to reduce emissions from vulnerable households in rural areas and by 3% its commitment to insulate homes with solid walls.
Because Utilita failed to deliver on these obligations, its customers missed out on a potential £30,000 of savings on their energy bills, Ofgem said.
Utilita said lack of monitoring lead it to exceed some obligations and fail to meet others.
A spokesperson for Utilita Energy told Energy Live News: “We are sorry we did not meet our ECO2 obligation. We fully accept the fine and thank Ofgem for its patience and understanding. This was simply down to administrative failings that we have subsequently rectified.
“We firmly maintain that we actually over delivered on the required quantity of carbon savings – but some were not recorded in the final total – and Ofgem has acknowledged this.”
The supplier has volunteered to provide more regular updates to Ofgem during the next phase of the scheme, ECO3.
The regulator has decided not to take formal enforcement action against Utilita, but the supplier will make a £175k payment into the Energy Redress Scheme.
The energy redress fund, run by Ofgem and administered by the Energy Savings Trust, supports charitable initiatives that assist vulnerable energy customers. It’s funded by contributions made by suppliers following compliance and enforcement action by Ofgem.