ESB and Carrington pay GBP 6 million over inflated balancing data
Ofgem found that from March 2019 to September 2020 Carrington, at the direction of ESB Independent Generation Trading, regularly submitted a stable export limit above the level at which the plant could export stably, and sometimes an inflated minimum non-zero time. Both companies admitted inadvertent breaches and agreed to pay GBP 6,000,000 to the voluntary redress fund; Ofgem closed its compliance engagement.
On this page
The decision
- Authority
- Ofgem (OFGEM), Great Britain
- Published
- 24 August 2021
- Participants
- ESB Independent Generation Trading Limited; Carrington Power Limited
- Commodity
- Electricity
- Market
- GB Balancing Mechanism
- Conduct period
- March 2019 to September 2020
- REMIT
- Article 5 (Market manipulation)
- Type of conduct
- Misleading balancing data
- Penalty
- GBP 6,000,000 paid into Ofgem's voluntary redress fund
- Status
- Final
What Ofgem found
Ofgem's decision of 24 August 2021 closes its compliance engagement with ESB Independent Generation Trading Limited (IGT) and Carrington Power Limited. IGT controls the output of Carrington's power plant. Ofgem found that from March 2019 to September 2020 Carrington, at IGT's direction, regularly submitted data to National Grid ESO that inflated the plant's Stable Export Limit above the minimum level at which it could export under stable conditions. It did so routinely at the request of IGT traders in periods when IGT and Carrington were seeking to generate in the Balancing Mechanism.
On some of those occasions, again at traders' request, Carrington also inflated the Minimum Non-Zero Time, the minimum time a Balancing Mechanism unit must run once instructed to generate. Ofgem found that these practices meant the system operator was at times required to buy a greater volume of power from IGT than it needed when the plant was called on to generate.
The rules applied
Ofgem applied Balancing Code 1.4.2(e) of the Grid Code, which requires dynamic parameters, including the Stable Export Limit and Minimum Non-Zero Time, to reasonably reflect the expected true operating characteristics of the unit, and Balancing Code 1.4.3, which requires reasonable endeavours to keep the data held by the system operator accurate at all times. Carrington admitted that it inadvertently failed to meet those obligations and its licence obligation to comply with the Grid Code. Both companies admitted that they inadvertently breached Article 5 of REMIT, because the inaccurate parameters gave false or misleading signals as to the supply of wholesale energy. Ofgem cites its April 2020 InterGen finding as establishing that submitting inaccurate dynamic parameters in the Balancing Mechanism constitutes market manipulation under REMIT.
The companies' account and the outcome
IGT considered that its approach to changing Carrington's dynamic parameters was in line with its understanding of its regulatory obligations at the time, and that recovering the fixed costs of generating over a greater volume would result in lower balancing costs. It now acknowledges that the approach was a breach and sometimes led the system operator to buy a larger volume and spend more than necessary. Ofgem considered that the two companies had insufficient procedures and internal controls to prevent non-compliance; they have since improved their compliance processes and training.
IGT and Carrington agreed to a collective payment of GBP 6,000,000 to Ofgem's voluntary redress fund. Ofgem closed the engagement without further enforcement action, taking into account the admissions, the steps taken to avoid recurrence and the redress, and states that without those actions it would have opened a formal enforcement investigation. The decision names no penalty and no discount. It refers to Ofgem's open letter of 29 September 2020, which says generators must not use dynamic parameters as a commercial tool to influence payments from the system operator.
For a surveillance function
Ofgem's finding of insufficient procedures and internal controls was about who could change declared plant parameters and on whose request. A firm whose traders influence what is declared to a system operator has to be able to show the technical basis for each declared value.
Sources
- Ofgem, Ofgem closes its compliance engagement with ESB Independent Generation Trading Limited and Carrington Power Limited, 24 August 2021 (Decision)
- Ofgem, Open letter: dynamic parameters and other information submitted by generators in the Balancing Mechanism, 29 September 2020 (Guidance)
- ACER, overview of REMIT sanction decisions (ACER register)
Sources read on 27 October 2026. This page restates what the authority published and adds no finding of its own. A decision under appeal is not final, and its status may have changed since: check the source before relying on it.