Suffolk/Essex: Households left without power during Christmas storms could receive more compensation after Ofgem orders energy companies to double minimum payouts

Electricity workmen repairing power cables

Electricity workmen repairing power cables

Households in Suffolk and Essex that were left without power following the storms last Christmas could be in for more compensation after energy firms were ordered to double their minimum pay out.

Regulator Ofgem has ordered energy companies SSE and UK Power Networks to pay an additional £3.3m after a probe into how they handled last winter’s storms.

The firms have already paid out £4.7 million and committed to improvements following the severe weather last Christmas in the south of England. It brings the total to £8 million.

In Suffolk 545 homes were left without power on the night before Christmas, with 1256 more properties in Essex also affected.

Ofgem said it was more than doubling the minimum payments of those affected by severe weather incidents in the future and has warned the industry that it must learn the lessons of last winter.

It said it found that while SSE and UKPN’s southern arms were badly hit by the storms “they could have done more to get customers reconnected faster and to keep them better updated on what was happening”.

The announcement comes as the Competition and Markets Authority sets out details of a major probe it is opening into Britain’s energy market.

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Severe weather over Christmas 2013 saw power cuts affect nearly a million homes. Ofgem said SSE and UKPN’s power networks bore the brunt of it.

Each had nearly 1,100 incidents, affecting a quarter of a million customers on the networks.

Between them they restored power to more than 95% of customers within 48 hours. But almost 16,000 customers remained affected for more than 48 hours.

Ofgem said: “The companies have recognised that they must improve their procedures for any future major interruption and Ofgem has today put the industry on notice that any repeat of last year’s performance issues will trigger further action.”

The firms have so far paid £4.7 million to consumers under current “guaranteed standards” and in goodwill payments.

But the regulator said that in the light of its findings they had agreed to make donations totalling £3.3 million to organisations such as the Red Cross that play a key role helping vulnerable customers during severe weather.

Ofgem also confirmed improvements to guaranteed standards payments to customers who face long power cuts in severe weather, which will come into force in April.

The minimum payout for consumers left without power for at least 24 hours during a severe weather event will rise from £27 to £70.

In addition, the cap for payouts will rise from £216 to £700, while Ofgem also said automatic payments should be made to customers where possible.

It said the changes would strengthen the incentives for companies to act quickly and reconnect customers as soon as possible.

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.”

SSE’s payout totals £4.6 million, including £2.3 million in guaranteed standards and goodwill payments and £2.3 million to the British Red Cross, Age UK, National Energy Action, Macmillan Cancer Support, and to a new community fund.

UKPN’s payout totals £3.4 million, including £2.4 million in guaranteed standards and goodwill payments and £1 million to the British Red Cross, the Royal Association for Deaf People, Carer’s Trust and Citizens Advice.