Ofgem is issuing Symbio Energy with a provisional order, which compels it to pay around £450,000 in full for a government environmental scheme.
The Feed In Tariff (FIT) scheme (1), which is administered by Ofgem, provides payments to owners of small-scale renewable energy generators, and is funded through compulsory levies on suppliers (2).
Any supplier that fails to pay its payment by the deadline of 11 August 2021 is in breach of the rules of its supply license (3).
Symbio fails to make its Year 12 Quarter 1 FIT payment
Symbio has failed to make its Year 12 Quarter 1 FIT payment by the deadline
Symbio has failed to make its Year 12 Quarter 1 FIT payment by the deadline and has told Ofgem it will pay on 3 September, over three weeks late. This will delay the distribution of this money to generators and suppliers.
At the same time, Ofgem is consulting on a final order requiring Symbio to respond to a request for information on the supplier’s cash flow forecasts. The request follows its failure to make previous deadlines for payment into government renewable schemes. This kind of request for information is common and routine for Ofgem to issue.
Ofgem can open formal investigation into non-compliance
If Symbio fails to comply, it could end up having its license revoked and Ofgem may open a formal investigation into the potential non-compliance, which could result in the supplier paying a penalty.
Key Notes:
- The Feed-in Tariffs scheme is a government program 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 levelization 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, while taking into account any payments they have made to FIT generators.
- SLC 33 stipulates that all licensed electricity suppliers that have supplied electricity in Great Britain, within the relevant FIT year or quarter are obligated to participate in the FIT levelization process. They have to declare the amount of electricity they have supplied and make a financial contribution towards the scheme in proportion to this.
- Provisional and Final Orders may be made by the Authority to secure compliance with regulatory obligations. A provisional order usually takes effect immediately (for a maximum of three months, unless confirmed) while a final order is subject to a three-week consultation period. The Authority can further enforce a provisional or final order by way of a High Court injunction, or (in some circumstances) by revoking the supplier’s license.
Ofgem – UK’s independent energy regulator
Ofgem is Britain’s independent energy regulator. Their role is to protect consumers now and in the future by working to deliver a greener, fairer energy system. They do this by:
- Working with government, industry and consumer groups to deliver a net zero economy at the lowest cost to consumers.
- Stamping out sharp and bad practice, ensuring fair treatment for all consumers, especially the vulnerable.
- Enabling competition and innovation that drives down prices and results in new products and services for consumers.