Ofgem has fined two related power companies a combined £6 million for submitting inaccurate data on energy supply, thereby breaching rules on manipulating wholesale markets.
ESB Independent Generation Trading (IGT) and Carrington Power, operator of the gas-fired station it controls in suburban Manchester, repeatedly passed erroneous data, prompting the ESO to buy more energy from the plant than needed, leading to higher costs for consumers.
Repeatedly between March 2019 and September 2020, figures mis-stating the plant’s minimum available supply were presented, an Ofgem investigation found.
NG-ESO routinely buys power from generating plants to prevent there being too much or too little power on the national system. The company relies on receiving accurate information from generators to ensure it can do so economically and efficiently.
Some of Carrington’s submissions had the effect of inflating the plant’s Stable Export Limit (SEL) above the minimum level at which the plant could, under stable conditions, export power.
In some instances, Carrington also submitted data at the request of IGT traders which inflated the plant’s Minimum Non-Zero Time (MNZT). This relates to the minimum time that a Balancing Mechanism unit – a generating plant providing balancing services to NGESO – must run for, when responding to the NG’s instruction to generate.
These practices both meant that NG-ESO was required to purchase more power from IGT than needed when it instructed the plant to turn on and generate at its SEL.
The rule-breakers considered their approach compliant with their obligations, and believed it would benefit the ESO. But Ofgem ruled that they lacked internal processes to ensure staff understood and applied the rules correctly.
ESB Independent Generation Trading and Carrington Power subsequently corrected their protocols. The pair have admitted that they inadvertently breached the rules and have agreed to pay £6 million to the energy redress fund to support vulnerable consumers.
Cathryn Scott, Ofgem’s regulatory director, said, “We have taken strong action against another generator for submitting inaccurate data to National Grid Electricity System Operator.
“Data accuracy is essential for keeping the costs of running the electricity system as low as possible for consumers”, Scott added.
“This case sends a clear signal to all generators that we are closely scrutinising their conduct and will not hesitate to act if they fall short of the standards we expect.”
