Ofgem has agreed to allow Together Energy to claim up to £4.5 million to settle the costs it incurred during the supplier of last resort (SoLR) process in December last year.
As part of this, the Scottish company took over the 36,000 customers of failed supplier One Select.
In January, Together Energy gave notice to Ofgem of its intention to submit a claim for a £4.8 million last resort supply payment (LRSP).
In some circumstances energy retailers’ licences allow them to make a claim for the otherwise unrecoverable costs they have incurred in being a SoLR. This would be paid by a levy on gas transporters and electricity distributors’ distribution use of system (DUoS) charges.
Together’s claim included £763,000 for closed credit balance refunds owed to former One Select customers. To date, Together has refunded £475,000, reflecting a lower than expected number of claims.
Ofgem says it has therefore determined the SoLR’s claim for this cost should be the £475,000 paid to date.
| Item | Cost category associated with SoLR | Cost consented to (£) |
| 1 | Recovery of 61% of One Select customers’ net credit balances | 3,000,879 |
| 2 | Wholesale energy emergency purchase | 21,381 |
| 3 | IT migration, data cleansing and billing | 774,644 |
| 4 | Interest on LRSD payment profile | 716,901 |
Total £4,513,805
Paul Richards, chief executive of Together Energy, said: “We welcome Ofgem’s decision and are pleased to have concluded on our LRFSP payment.
“Every SoLR process is unique and servicing the customers has been challenging at times, however Ofgem has been responsive, supportive and transparent throughout the process.”
In October the Dutch sister company of One Select had its energy licence revoked by The Netherlands Authority for Consumers and Markets (ACM).
The Dutch ACM announced on 15 October it had established that the supplier was no longer able to “comply with the requirements of its energy licence”.
One Select itself became the eighth supplier to exit the market in 2018 last December.