Ofgem takes action against Delta Energy for failures affecting customers
Press release
Publication date
Industry sector
Supply and Retail Market
- Energy regulator has issued Delta Gas and Power Ltd (Delta) with a Provisional Order for failure to pay £57,000 to support renewable energy generation
- A further Provisional Order has been sent to the same company for failure to respond with information needed for customer energy supply safety net
- All part of the energy regulator's robust approach to enforcement and compliance
Energy regulator Ofgem has today (Tuesday 29 November 2022) issued two Provisional Orders to Delta Gas and Power Ltd (Delta), for failure to meet the standards set for them as a supplier.
Delta is a non-domestic energy supplier, serving 1,690 business customers in the UK.
The two Provisional Orders have been sent out for:
- failure to pay into the Feed-in Tariff (FIT) scheme, a programme which supports investment in and uptake of renewable electricity generation, and
- failure to provide requested information for Ofgem’s flagship Supplier of Last Resort (SoLR) scheme, which ensures continuity of supply to a customer (i.e. they are transitioned to a replacement energy provider) should their existing supplier exit the market.
This follows the Provisional Order already issued to Delta previously in November relating to its operational capability and financial resilience.
Cathryn Scott, Ofgem’s Director for Enforcement & Emerging Issues, said:
“These challenging times are no excuse for poor performance from energy suppliers. Suppliers have a legal duty to comply with their obligations to provide us with full and accurate information and to participate in important renewable energy schemes. Delta has failed in this instance, which undermines the schemes’ integrity. We have always been clear that failure to comply fully and promptly with our requests for information has the potential to disrupt the processes in place to protect consumers. Our expectations of suppliers are clear and the Orders we have issued today set out actions Delta must take immediately to address shortcomings now and for the longer term”.
Ofgem expects immediate actions to be taken by Delta and as such has requested that it:
- Pays the £57,000 immediately: It is imperative that all suppliers make their FIT payments on time to ensure the integrity of the FIT scheme.
- Provides the missing information by 5pm Monday 5 December 2022: The original request for information was sent 2 September and was re-issued 9 November.
Failure to do so will result in Ofgem taking further enforcement action.
This comes on the back of a full Market Compliance Review last week where Ofgem ordered 17 suppliers to do more to protect vulnerable consumers this winter and beyond.
Notes to editors:
Provisional Orders are an enforcement action used by Ofgem made with the intention of bringing an end to an apparent breach of a licence condition.
Feed-In-Tariff - Provisional Order
The FIT scheme is a government scheme designed to incentivise renewable electricity generation. Participants (FIT generators) receive payments for the renewable electricity they generate and export to the grid. Delta has failed to pay the sum of £56,707.09 into Ofgem’s FIT levelisation fund, in respect of FIT Year 13, Quarter 2, which was due by 10 November 2022. This is despite engagement from Ofgem before and after the due date. Delta’s failure to comply with its FIT obligation has resulted in a shortfall in the scheme funds, meaning that other suppliers due to receive money out of the fund to pay FIT generators ultimately receive less.
Delta is potentially in breach of Standard Licence Condition 33.
About the FIT Scheme:
The FIT scheme was introduced on 1 April 2010 by government to promote the uptake of renewable and low-carbon electricity generation. The scheme requires participating licensed electricity suppliers to make payments to FIT generators for electricity generated and exported by accredited installations. FIT customers range from houses with a few solar panels to farms with a multiple panels and wind turbines. FIT Generators mean anyone who has installed an eligible installation, accredited to the FIT scheme. Such installations generate renewable electricity and FIT Generators receive regular payments from energy suppliers for the renewable electricity they generate and export to the grid. View more information about Feed-in-Tariffs.
Supplier of Last Resort (SoLR) - Provisional Order
The SoLR scheme allows Ofgem to direct any gas or electricity supplier to take on a failed supplier’s customers. A Provisional Order has been issued to Delta on the grounds that despite subsequent engagement, it has failed to respond in full to a Request for Information (RFI) issued by Ofgem. The information provided by Delta is incomplete, which places the supplier in potential breach of licence condition requirements. The absence of adequate data risks Ofgem being unable to prepare adequately for a possible SoLR process, should one be required. As part of the SoLR scheme, when a new supplier is chosen, it must meet certain suitability criteria, including an ability to supply additional customers without significantly prejudicing their ability to continue supplying existing customers.
About the SoLR scheme:
The SoLR scheme allows Ofgem to direct any gas or electricity supplier to take on a failed supplier’s customers. As part of the SoLR scheme, when a new supplier is chosen, it must meet certain suitability criteria, including an ability to supply additional customers without significantly prejudicing their ability to continue supplying existing customers. The new supplier is selected following a competitive tender process. See information around the Supplier of Last Resort scheme and how customers are protected should their provider collapse.