The owner of Britain’s largest electricity distribution network Western Power Distribution has agreed to pay £14.9mn after it was found to have let down vulnerable customers on a number of “totally unacceptable” fronts.
Energy regulator Ofgem announced the settlement on Wednesday after a probe launched in 2020 into whether the company had been meeting its obligations towards its 1.7mn customers considered to be in “vulnerable circumstances”.
Among the breaches uncovered by the regulator, WPD did not verify that staff had the correct background checks, including criminal record checks, before visiting customers’ homes, Ofgem said.
WPD has agreed to the settlement at a time when UK energy companies are under scrutiny as gas and electricity bills soar.
Ofgem recently launched a separate inquiry of whether some electricity and gas suppliers are increasing customer direct debits more than is necessary.
The regulator said WPD had also not met all of its obligations to provide extra services to households on priority registers, which can include pensioners, people with disabilities and long-term medical conditions and families with young children.
Priority registers are meant to ensure certain customers receive prompt information and extra advice from electricity network companies if there is a power cut. These customers may also be eligible for additional help such as mobile generators, hot food and drink, and alternative accommodation.
WPD did not promptly update some of its customers on those registers when they were affected by power cuts, Ofgem said. Some customers that signed up to the priority services register also waited up to a year for WPD to provide information on how to prepare for power cuts.
Cathryn Scott, director of enforcement at Ofgem, called the breaches, which occurred between March 2015 and July 2021, “totally unacceptable”.
“Our enforcement against the company sends a strong message that when companies fail to provide the required services to their Priority Services Register customers, Ofgem will take action,” she said.
WPD was bought by the UK’s National Grid group last year from the US utility PPL Corporation in a deal valued at £14.2bn. It is responsible for the electricity distribution networks that deliver power in south Wales, the south-west of England and the Midlands. Households pay towards the costs of running gas and power networks via a surcharge on their energy bills, which typically amounts to about a fifth of the total.
The breaches occurred before National Grid’s ownership, WPD said.
The company said it had been “shocked when we discovered Ofgem considered there were shortcomings with our service” and suggested that “at the core of Ofgem’s concerns were licence interpretation issues that impacted the whole sector”. However, it added that “as soon as we became aware of Ofgem’s requirements we took decisive action to address the issues”.