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Energy supplier SSE has been fined £2m by the energy regulator Ofgem, for failing to publish inside information about the wholesale energy market.
The fine relates to a deal SSE struck with electricity system operator National Grid in March 2016.
SSE had previously announced it would close three units at its Fiddler’s Ferry power station near Manchester, but the agreement with National Grid made it likely those units would remain operational.
The combined generating capacity of the units was equivalent to 3% of peak electricity demand in Great Britain, which therefore affected wholesale energy prices.
As a result, four days of energy market trading took place where companies did not know that more energy generation was likely to be available than anticipated. Some of those in the market may have ended up paying more for wholesale electricity.
Ofgem found that SSE did not publish the information in a timely manner, but waited until it had finalised the National Grid deal.
The regulator said SSE had made the wrong decision about whether it was in possession of inside information about how much energy it expected to generate, although Ofgem did not find it had acted in bad faith.
As a result the company has been charged the first fine relating to the publication of inside information in energy markets in Britain and the EU, under rules known as Regulation on Wholesale Energy Market Integrity and Transparency (Remit).
Ofgem’s chief executive, Jonathan Brearley, said the fine “sends a strong message to market participants that they must be familiar with, and keep to, their obligations under Remit rules or face enforcement action by Ofgem.”
SSE qualified for a 30% discount on the £2.6m proposed penalty after fully co-operating with the investigation and settling early.
The energy supplier said it takes market disclosures very seriously, and that it did not benefit from only publishing the information once the contract was signed.
Martin Pibworth, SSE’s energy director, said “We subsequently understood that Ofgem’s interpretation required disclosure to the market at an earlier stage. We admit that our approach was not in line with this requirement.”
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