Energy firms SSE and UKPN to pay out over Christmas storms

LONDON Thu Jul 24, 2014 10:48am BST

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LONDON (Reuters) - British energy firms SSE and UKPN have agreed to pay 8 million pounds in compensation after tens of thousands of customers were left without power during torrential storms last December, regulator Ofgem said on Thursday.

Power cuts hit nearly one million homes when hurricane-force winds and rain swept across Britain in December. Of those, around 250,000 SSE and UKPN customers were affected by incidents on their networks, significantly more than other suppliers.

SSE is Britain's second-largest energy supplier and UKPN, or UK Power Networks, owns and maintains electricity cables across London, the south east and the east of England.

Ofgem said that while SSE and UKPN's southern arms were badly hit by the storms, they should have reconnected household power faster. Around 16,000 of their customers were left without power for more than 48 hours.

"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," said Maxine Frerk, Ofgem's Senior Partner for Distribution.

The firms have already paid 4.7 million pounds to customers and they will now donate 3.3 million pounds to organisations like the British Red Cross, which helps vulnerable people during power cuts and severe storms.

Ofgem has also changed the possible payments that could be paid out in the future. From April 2015, the minimum compensation will more than double to 70 pounds if customers lose power for at least 24 hours, and the cap for payment to customers will become 700 pounds from 216 pounds.

(Reporting by Tess Little)

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