SSE’s wind farm fined record £33m for pushing up household bills

A wind farm owned by energy giant SSE is to pay a record fine to the energy regulator after overcharging customers.

Ofgem said on Tuesday that the Beatrice wind farm, located off the Scottish coast, had agreed to make a payment of £33m after breaching part of its licence conditions.

The operator breached one of its licence rules by charging excessive prices to cut its power output when needed to prevent the national grid being overloaded. This, in turn, pushed up costs for consumers such as households and businesses, Ofgem said.

Beatrice is one of Scotland’s largest offshore wind farms, with 84 turbines located around 8 miles off the Caithness coast. Its turbines are capable of producing energy for up to 450,000 homes.

The wind farm is operated by SSE on behalf of a consortium, Beatrice Offshore Windfarm Limited (Bowl), of which SSE owns 40pc.

Bowl admitted to the breach, describing the issue as “wholly unintentional”.

Ofgem has been investigating power generators for alleged market manipulation after they were accused of overcharging consumers.

Wind farms are paid to switch off during times of low demand and high output to stop the electricity grid being overwhelmed.

Ofgem was handed a dossier gathered by analysts at the Renewable Energy Foundation (REF), which suggested wind farm companies could be boosting the price of “virtual energy” they never actually generated.

The fine for Bowl is the fifth, and largest, handed out by Ofgem for this kind of abuse. The previous record was £23m, which was levied against a power company owned by Czech billionaire Daniel Kretinsky last October.

Ofgem said in a statement: “Ofgem has been clear that electricity generators must put in place controls to ensure that their prices are set in a way that ensures that they do not obtain excessive benefits during the periods where they are required to reduce output due to the limitations of the transmission network.

“If they fail to do so, they should expect to face large penalties.”

Bowl has agreed to make the £33.14m payment to Ofgem’s redress fund, which supports vulnerable people with their energy needs.

A spokesman for Bowl said: “Beatrice Offshore Windfarm Limited accepts that it breached one of its electricity generation licence conditions. The breach was in Bowl’s view wholly unintentional.

“Bowl will make a payment to the Ofgem consumer redress fund, has reviewed its bid pricing policy and fully cooperated with Ofgem throughout to conclude this process.

“With other industry participants, Bowl is engaging on proposed modifications to the relevant industry code and Ofgem’s ongoing consultation on its approach to interpreting and enforcing the transmission constraint licence condition.” 

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