Ofgem investigation response for energy supply company

We are currently acting for an energy supply company which is facing an existential threat to the business by way of a public investigation by Ofgem as its regulator.

In December 2023, the business was subject to an extremely large request for information (RFI) which spanned 18 months of historical RFIs and numerous business critical issues, including application of the EPG/EBSS/EBRS energy schemes and compliance with their standard licence conditions (SLCs) in light of a problematic white label arrangement (the first tranche of the project).

In 2024 the business was subject to further RFIs (the second tranche), and the work required to underpin the business’s answers was even greater than in the first, involving further technical energy and restructuring/business protection support from our team.

Our strong expertise in the energy supply sector, together with our knowledge of the client’s business, placed us in a unique position to manage and support the business through this gargantuan task (which to date has involved a team of over 10 fee earners, led by partner Rebecca Andrews-Walker and closely supported by associate Holly Sargeant, working over a five-week period (first tranche) and then a further eight weeks (second tranche)).

This unique project involved analysis of historical data spanning vast volumes of documents across both the Collaborate and Relatively platforms, as well as construction of business wide practices and compliance strategies, together with the inhouse legal and compliance functions within the business. Our team even recalibrated the business’s billing regime against statutory and regulatory criteria.

We also advised on complex and niche Ofgem specific regulatory impacts, framing the responses to try to preserve the business’s supply licence (which if lost, would mean the end of the business, and a transfer of all customers away through the ‘supplier of last resort’ process). This engagement is a stellar example of the calibre of our high-profile specialist energy restructuring practice, orchestrated across our UK offices, with input from our corporate and restructuring and insolvency teams, and our energy and regulatory sector groups.

Our client is still awaiting the conclusion of Ofgem’s investigation, and we remain on board to consider how the business will need to respond to any of the available outcomes (which could include judicial review).