Ofgem hits SSE with £9.78m fine after securing ‘excessive’ payments which raised costs for customers – City AM

Ofgem has imposed a hefty £9.78m penalty on SSE Generation for securing excessive payments from the UK’s electricity system operator, which was in breach of its licence and raised costs for customers.

SSE Generation are expected to pay the sum in full by Tuesday 5 September.

The watchdog confirmed the penalty will be paid into its voluntary redress fund, a support kitty for vulnerable households, after first proposing the fine last month.

It determined that the company gained excessive payments from the ESO during periods of what is known as ‘transmission constraint.’

This is when there is either shortfalls or excesses in power, requiring ESO to pay generators to turn off or power on generators to maintain balanced supplies.

Excessive prices are curbed by the terms of the transmission constraint licence condition (TCLC).

In October 2021, Ofgem opened an investigation into SSE’s compliance with the TCLC in relation to its Foyers pumped storage power station, which is located in Northern Scotland and regularly operates in transmission constraint periods.

Ofgem found that in May 2020, SSE decided to make the bid prices it charged the ESO to reduce Foyers’ output significantly more expensive – including in periods of transmission constraint. https://www.cityam.com/ofgem-hits-sse-with-9-78m-fine-after-securing-excessive-payments-which-raised-costs-for-customers/?fbclid=IwAR2ajML2aFi4frpVN09UT1FaaTh7dmal6JTzYMpdcy-leN0KiwrUbmogbX4