Opus Energy hit with £125,000 fine for misreporting power supplies

Ofgem has fined business energy supplier Opus Energy £125,000 for misreporting the amount of power it supplied under the government's subsidy scheme for renewable electricity, the Renewables Obligation (RO). The regulator has also ordered the company to scrap £360,000 worth of RO certificates.

The regulator said the company had avoided a heavier penalty because it had engaged with Ofgem in settling the issue; it had not contested Ofgem’s findings; and it had taken prompt action to address the harm it had caused to other market participants.

The maximum possible fine for the offence was 10 per cent of turnover which in Opus’ case would have amounted to more than £20 million. “Opus Energy’s willingness to engage in the settlement process was reflected in the level of penalty. Without this, the penalty would have been much higher,” said Ofgem director Sarah Harrison.

The company apologised “wholeheartedly” and added: “We have made substantial changes to our procedures to ensure this never happens again.”

Ofgem’s discovered Opus’ under-reporting of electricity supplied to customers in 2009-10 through its annual audit of RO reporting. Opus under-reported by 7.4 per cent and gained £360,000 through not submitting RO certificates or payments into the buy-out fund.

Ofgem said the misreporting was caused by shortcomings in Opus Energy‟s methods for calculating its electricity supply data. According to Ofgem, it had used its own view of supply volumes rather than, for example, referring to figures from the power industry’s balancing and settlement firm Elexon. And the watchdog said Opus had failed to provide adequate resources for data supply and sufficient supervision by senior management.

The regulator said Opus had amended its procedures in line with Ofgem‟s recommended method to calculate electricity supply data under the RO.