Power cut compensation more than doubled

Household money

Updated on 24 July 2014 | 1 Comment

Ofgem demands bigger payments following winter storms.

Ofgem has announced that the minimum compensation will more than double for customers whose power goes out for at least 24 hours during periods of difficult weather.

Amidst the winter storms last Christmas, nearly one million people in southern England were left without energy. 16,000 households were cut off for over 48 hours.

The regulator was particularly unimpressed with the performance of SSE and the UK Power Networks (UKPN) during the harsh weather. Though conditions were difficult, Ofgem said that they could have done more to get people reconnected faster and keep them up-to-date with what was happening.

It has put the industry on notice, warning that any repeats of last year’s performances will trigger further action.  

More money for helpful charities

An extra £3.3 million has been secured from SSE and UKPN by Ofgem on top of £4.7 million already paid out to customers under guaranteed and goodwill payments.

The £3.3 million will go to organisations like the British Red Cross, who play a vital part in helping those affected by these events. This brings the energy suppliers’ total payout to £8 million.

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Additional measures

To further strengthen incentives for companies to act quickly under these circumstances, Ofgem has improved guaranteed standards payments for all affected customers.  

From April 2015:

  • Compensation will increase to £70 from £27 if customers are cut off for at least 24 hours during severe weather events.
  • The cap on payments to those affected will shoot up from £216 to £700
  • Automatic payments will be made to customers wherever possible

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Were you without power during last year’s storms? Do you think that these measures will be effective? Let us know in the comments section below.

More on energy:

Energy market to be probed by competition authority

Ten ways to save on energy

Long-term fixed energy tariffs versus short-term

Customer satisfaction with energy providers hits a new low

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