Ofgem fines Centrica's British Gas £11.1m

4th Dec 2014 08:52

The UK energy watchdog has fined Centrica's British Gas £11.1m for failing to hit energy savings and carbon emission reduction targets on time.Ofgem said British Gas would pay £11.1m to benefit vulnerable customers after a regulatory investigation found the company failed to meet its environmental obligations under the Community Energy Savings Programme (CESP) and Carbon Emissions Reduction Target (CERT) by the 2012 deadline.British Gas delivered 62.4% of its CESP obligations by the deadline and also failed fully to meet its CERT obligations, achieving 99% of its overall obligation.Under CESP, energy suppliers and generators were required to provide householders with energy saving measures by the end of December 2012.Ofgem said British Gas's failure to meet the CESP targets led to around 6,750 households in low income areas experiencing delays in receiving energy saving measures which would have helped keep homes warm and lower bills during the winter of 2012/13.The CERT scheme required certain gas and electricity suppliers to achieve targets for reducing carbon emissions within domestic properties. British Gas made up a shortfall seven weeks after the target, meaning households were unable to benefit from energy efficient measures which they ought to have received earlier.Following the missed deadlines, British Gas installed energy efficiency measures equivalent to the volume of its CERT and CESP shortfalls, which it completed in February and August 2013 respectively.Ofgem said the fine reflected British Gas's settlement of the investigations, without which the payment would have been higher. It also ensures British Gas did not gain financially for not meeting its targets on time.Sarah Harrison, Ofgem's senior partner with responsibility for enforcement, said: "British Gas' failure to deliver two environmental obligations on time is unacceptable. Thousands of households had to wait for energy efficiency measures, like insulation, to be installed during the winter."The payment reflects British Gas' failure to meet its obligations on time but also recognises its commitment to put things right."Centrica shares dropped 0.4p or 0.1% to 284p at 09:39 in London.