Ofgem slaps Drax, InterGen with $61MM in fines (Video)

UK regulator Ofgem has hit Drax Power and InterGen with a total of £39 million (US$61 million) in penalties for failing to meet mandated environmental obligations

UK regulatory authority Ofgem announced it has secured a total of £39 million (US$61 million) in panalties from two energy companies for failing to meet environmental targets under the government’s Community Energy Savings Program (CESP).

Ofgem said it has secured £11 million (US $17 million) from independent generator InterGen and £28 million (US $44 million), the largest fine issued in the regulator’s history, from Drax Power. InterGen and Drax were among six companies under investigation by Ofgem for failing to meet mandated obligations under the UK’s CESP initiative.

CESP was designed to lower carbon emissions through the delivery of energy saving measures, such as loft and cavity wall insulation free of charge, to households in low income areas. The UK government required generators as well as energy suppliers to deliver against individually set targets by the end of December 2012.

According to Ofgem, InterGen had only delivered 6.4 percent of its total obligation by the original deadline and Drax Power just 37.1 percent of its CESP responsibility in the same period. Ofgem said the shortfalls have led to several thousand households in some of the most deprived areas in Britain missing out on free energy efficiency measures that would have reduced bills and kept homes warm.

Ofgem said it is working with the companies on how the payments will be applied to directly benefit the consumers CESP was designed to assist. Final penalty notices will be issued in early January.

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