Ofgem doubles payouts for power cuts

24 July 2014

Households left without power during bad weather will be able to claim higher compensation from energy providers from next year, the regulator has announced.

Ofgem will be more than doubling the minimum amount people can claim if they are left without power for at least 24 hours from £27 to £70 due to severe weather, with the changes set to be introduced from April 2015.

The maximum amount a customer can claim has also been raised substantially from £216 to £700, in an effort to encourage energy firms to try to reconnect customers as quickly as possible.

The move follows last winter's storms that left thousands without power in the south of England.

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Ofgem was particularly unhappy with the performance of two firms, SSE and UK Power, and has ordered them to donate an additional £3.3 million to organisations such as the Red Cross - which helped distressed customers during the storms - on top of the £4.7 million they have already paid out in compensation payments.

Ofgem said while the firms' regions were particularly badly hit by the weather - around 16,000 homes were left without power for more than 48 hours – they could have done more to get households reconnected quicker and kept them better informed of the situation too.

Both companies have pledged to improve their procedures, Ofgem added, but warned that any repeat of last year's performance from any firms will result in further action being taken.

Maxine Frerk, Ofgem's senior partner for distribution, said: "A power cut at Christmas time is the last thing anyone needs. While we recognise the hard work of the companies and their staff who were out working to reconnect customers during the severe weather, the companies could have done more to plan for the weather and keep customers informed. This is why we have secured an additional £3.3 million, bringing the total payout to £8 million.

She added: "Network companies need to learn the lessons of last winter."

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