Ofgem has ordered Nabuh Energy and Breeze Energy to make overdue payments into the Renewables Obligation (RO) scheme or risk enforcement action.
Nabuh Energy owes £872,200.62 plus interest into the scheme, which supports renewable energy generation.
The Sheffield-based supplier had previously indicated it would pay the balance by 31 October but failed to do so. The regulator said Nabuh Energy needed to clear its debt immediately or face enforcement action, including the possible revocation of its supply licence.
Nabuh Energy said it had told Ofgem it would make the payment on or before 8 November.
A spokesperson for the supplier said: “The delayed payment is not a cause for concern for any of our suppliers or customers and Ofgem have been made aware of the nature of the circumstances which have led to a delay in the balance of the RO payment being made.”
Nabuh primarily supplies homes with prepayment meters, the firm said. While other suppliers have a consistent cash flow throughout the year, with credit customers paying a constant amount via direct debit, Nabuh receives less money in the spring and summer, when energy use is low, and consumers aren’t topping up their meters as frequently. It offsets this with higher intakes during the autumn and winter, it said.
Nabuh also said it had grown significantly over the last 12 months, meaning it has required additional funding to meet its RO payments, owed at the end of summer.
“Additional funding has been arranged and agreed however due to circumstances beyond the control of Nabuh, we have experienced delays which have caused a delay in the full payment of our RO obligations,” the spokesperson said.
“We take our regulatory and environmental obligations very seriously and would like to take this opportunity to apologise to our customers and suppliers for any concern that this issue may have caused.”
Meanwhile, Breeze Energy owes £486,232.06 plus interest in Renewable Obligation payments, Ofgem said. Breeze Energy, which operates exclusively in the North East of England, also failed to deliver payment by 31 October, as it assured the regulator it would, and needs to produce the sum immediately or face enforcement action.
While failure to meet RO payments often indicates an energy supplier is financially struggling, Breeze Energy has recently won accolades for its customer service. It occupied the highest spot in Citizens Advice’s latest customer service league table, covering the period between April and June 2019.
Under the RO scheme, energy suppliers must demonstrate they have sourced enough renewable electricity by presenting RO Certificates (ROCs) to Ofgem by 1 September. Alternatively, they can pay into a buyout fund run by the regulator by 31 August.
Nabuh and Breeze energy where among a handful of suppliers which failed to make the 31 August deadline and received a new deadline of 31 October.
Of those suppliers, Robin Hood Energy, the not-for-profit supplier owned and run by Nottingham City Council, and Delta Gas and Power have since cleared their balances.
Toto Energy has since gone bust, owing £4.5 million to the scheme. GnERGY has yet to make its £673,000 payment, plus interest, and also faces enforcement action.