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Gas company receives record fine over supply failures

Joanna Faith
Written By:
Joanna Faith
Posted:
Updated:
22/05/2019

The energy regulator has fined gas company Cadent £24m for “serious” past failures, which include leaving thousands of customers without supply for 19 days on average.

Ofgem said the company also failed to pay compulsory compensation over a six-year period to a possible 12,000 affected residents left without gas for over 24 hours.

Cadent also had no records of 775 high rise blocks of flats in its network, which meant they were not part of its regular inspection or maintenance programme.

Cadent has admitted all failings and issued “an unreserved apology to customers”.

Steve Hurrell, chief executive officer, said “We aim to put customers’ needs at the heart of everything we do, and we acknowledge that in the past, we have fallen short of customer expectations and the higher standards we have now set ourselves; for this we are sorry.”

Cadent, which is now under new ownership, said it would double the statutory compensation payments, at an estimated cost of £6.7m. These payments will be made to customers who experience an unplanned gas supply interruption for longer than 24 hours over the next two years

Dermot Nolan, chief executive of Ofgem, said: “Cadent has a duty of care and responsibility to millions of people across half of the country who rely on the gas it pipes to their homes for cooking and heating.

“Ofgem has worked with the company, which is under new ownership and has given commitment to improve its operations to put customers at the heart of the business, to help it address its failings and prevent further harm to customers’ interests.”

Cadent is also setting up a community fund, worth an estimated £20m, to support vulnerable customers.

The £44m financial package – equating to the £24m fine and £20m community fund – is the biggest in Ofgem’s history.