Drax Power runs the UK's largest coal-fired power station

Electricity generators fined for missing energy-saving targets

Electricity generators Drax Power and Intergen have paid fines for failing to fund energy-saving measures for households in low-income areas.

Power generators as well as suppliers were given obligations to deliver energy-saving measures such as loft and cavity wall insulation to households by the end of December 2012 under the Community Energy Saving Programme.

Energy regulator Ofgem said it had received a £28m penalty from Drax, which runs Britain's largest coal-fired power station, while Intergen, which is jointly owned by the Ontario Teachers' Pension Plan and China Huaneng Group, paid £11m.

"Drax missed its target by a clear margin, disadvantaging several thousand households in some of the most deprived areas in Britain," said Ofgem. "Not only are these consumers missing out on energy efficiency measures that would help keep their homes warm, they also face higher energy bills as a result."

Drax delivered just 37 per cent of its carbon emissions reduction target under the scheme, according to the regulator, but the firm said it had voiced concerns from the outset about including independent power generation firms that have no direct relationship with domestic consumers in the scheme.

Drax chief executive Dorothy Thompson said Drax had sought to comply with the scheme, despite considering the design flawed, but with little experience of delivering energy efficiency measures the company had little option but to use a third-party provider, which failed to meet the target.

"We are deeply disappointed with the magnitude of the fine," she said. "However, we believe it is in our shareholders' interests to settle this matter and, as the nation's single largest power provider, focus on delivering a reliable supply of electricity this winter."

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