Six utility companies, including SSE and ScottishPower, are to be investigated by energy regulator Ofgem after allegedly failing to hit Government energy efficiency targets.
The firms, which also include British Gas, Drax, GDF Suez/IPM and Intergen, are to be investigated after supposedly missing performance benchmarks set out under the twin Carbon Emissions Reduction Target (CERT) and Community Energy Saving Programme (CESP) schemes.
The energy companies were warned by Ofgem in September last year that they risked enforcement action, which includes the possibility of a significant financial penalty of up to 10% of their annual turnover, if they were unable to meet the requirements imposed on them by the end of last year.
All six firms facing investigation are said to have missed their CESP targets, while SSE and British Gas were also found to have been non-compliant in one or more of their CERT targets.
SSE is not currently being investigated for CERT non-compliance, however, after the Perth-based firm submitted additional information to the watchdog in relation to two of its targets after the deadline had passed for consideration as part of the CERT final report.
SSE, which was hit by a record £10.5 million mis-selling fine by Ofgem last month, yesterday published information on its website stating it believed it had complied with CERT in full within the required time frame but admitted its failure in relation to CESP.
The company said it had achieved more than of 91% of the CESP requirement by December 31 but said it had contracts in place that would eventually deliver the full savings necessary.
Glasgow-based ScottishPower said it had over-delivered on its CERT target by more than 20% but conceded its CESP programme had fallen short of target by some 30%.
ScottishPower Retail and Generation chief executive Neil Clitheroe said his company had invested more than £400m in the last five years to achieve carbon savings and had made up the CESP shortfall since the turn of the year.
He said: “Although the design of the CESP programme was challenging, making it difficult to find suitable partnerships and properties to target under the scheme, we managed to achieve 70% of our target by the end of 2012, and had already identified and contracted work to achieve the remaining 30%.
“As at today, this 30% of measures has been installed in homes across the country, with approximately 20,000 families benefiting across our entire CESP programme.”
Sarah Harrison, Ofgem’s senior partner in charge of enforcement, said it was important for public confidence that energy firms were held to account when they failed to deliver on targets set.
“At a time of rising energy bills, energy efficiency can make a big difference for consumers,” she said.
EDF Energy, Eggborough Power, E.ON and RWE npower all managed to hit their targets and Ofgem said that overall more than 99% of the efficiencies targeted had been achieved.