Gnergy issued final order by Ofgem over renewable payments

Gnergy missed both the standard deadline and the late payment deadline with over £650,000 plus interest outstanding.

They have failed to assure Ofgem they would make the payment at all, so the regulator has begun enforcement action.

In separate news, Ofgem has announced Utilita is under investigation for breaking the level of the prepayment meter price cap in 2019.

Credit: Andrey_Popov/Shutterstock.com

Gnergy on brink

Gnergy were one of four energy suppliers named by Ofgem in October as at risk of failing to make their RO payments for 2018/19.

They had missed the general deadline of 31 August and Ofgem highlighted the possibility they would fail to pay by the late payment deadline of 31 October.

Now Ofgem have issued the supplier with a warning to settle their obligations within three months or their licence is liable to be revoked with only 30 days' notice.

As two months have passed since the late payment deadline and four months since the original deadline passed, it's looking increasingly doubtful that Gnergy will be able to fulfil their obligations and pay the money owed plus interest.

Renewables payments

The Renewables Obligation deadline is seen as a time of year when small energy suppliers who may be struggling show this more clearly and, in some cases, collapse.

We discussed the looming deadline back in August, pointing out that several suppliers including URE Energy, Economy Energy and Extra Energy all collapsed after failing to meet their obligations in full for the 2017/18 period.

Out of the four suppliers Ofgem highlighted as likely to fail in their October warning, Toto Energy has also collapsed and Robin Hood Energy was forced to borrow money to settle its RO balance.

However, Gnergy have hit back at Ofgem for issuing the final order now, with a spokesperson saying the Christmas holidays have delayed the transfer of funds and this 'unnecessary bad publicity' could have been avoid.

This is similar to comments made by Solarplicity's CEO when they collapsed following Ofgem's public warnings to the supplier.

Ofgem has recently concluded a consultation into proposals to review existing energy suppliers as they grow to check they have the finances and resources to serve their growing customer bases.

Utilita under investigation

In separate news, Ofgem have confirmed they have opened an investigation into Utilita's compliance with the price cap for prepayment meters.

The investigation relates to potential overcharging of customers between May and September 2019, and Ofgem have stressed that it doesn't mean Utilita have broken any rules, just that they may have.

This isn't the first time in recent years that Utilita have been in the spotlight. They paid £175,000 to the voluntary redress fund in 2019 for failing in their Energy Company Obligation (ECO) carbon reduction obligations.

Utilita accepted Ofgem's findings but blamed a lack of effective monitoring which left them over-delivering on some measures while failing on others.

Nor are Utilita the only supplier to face investigation over price cap failings. Last month, iSupply agreed to pay voluntary redress of £1.5m after overcharging over 4,000 customers between January and September 2019.

They were found to have breached the energy price cap for standard meters following the introduction of the cap in January 2019. As a result, customers were overcharged by around £36,000, although this was repaid and customers were also given compensation.

Compare cheap energy deals using our free comparison tool.