Ofgem has ordered Nottingham Council-owned Robin Hood Energy to pay £9.5m in overdue Renewables Obligation payments before the end of the month.
The regulator is also chasing three other small suppliers for money. Toto Energy owes £4,555,880, Gnergy owes £637,876, Delta Gas and Power owes £91,937.
Ofgem said it believes the four are “likely to breach their obligations”. The regulator said others owe money too, but it thinks they will pay.
Under the Renewables Obligation, energy suppliers are obliged to buy a certain amount of power from renewable sources. If they do not, they pay into a buyout fund.
The cost of the RO is added to the customer bill and the suppliers then pay into the fund at the end of the year.
Many of the small suppliers that have gone bust over the last two years failed to pay into the RO buyout fund. Struggling to stay afloat, some spent the money instead of putting it aside.
Over two years, consultants have estimated the missing RO money totals £100m, which other suppliers, and their customers, will have to pick up.
Citizens Advice research suggested the tab from 10 failed domestic energy suppliers stood at some £172 million in unpaid industry bills.
Robin Hood Energy’s accounts are two months late. Accountants have questioned whether it can remain a going concern.
Toto Energy must also find a significant amount in the next 30 days. It has been ranking poorly in customer satisfaction surveys, which Citizens Advice has warned is often a proxy for a struggling company.
Gnergy, run by a community of former Gurkhas, has admitted it is battling to keep the business afloat.
The three, along with Delta Gas and Power, could have licences revoked if they do not pay.
After the last round of failed suppliers, Ofgem moved to tighten market entry rules. Citizens Advice said it should collect RO payments more regularly to limit damage when suppliers go bust.
Related stories:
Ofgem revokes URE’s licence over unpaid RO bill
£100m tab for failed energy suppliers
Ofgem outlines new rules to prevent another house of cards
Energy supplier debt crisis “creating house of cards”
Economy Energy latest failed supplier
Spark Energy shuts down domestic supply business
Ofgem tightens supply licence rules as money goes missing
Big cracks emerging in energy retail
Risk mismanagement: More suppliers will go bust
Utility Warehouse: More independent suppliers will go pop
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At some stage Ofgem are going to realise they’ve squeezed the supplier sector so hard, they’ve broken the model. You can bet those in RO trouble won’t have the CM monies they are supposed to have set aside.
After all, SSE aren’t selling their supply business because it’s the jewel in the crown of their revenue model, are they? And only yesterday Utility Week posted a story that the price cap could lead to 10,000 job losses in the supply sector this year