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Cadent and SGN to pay £8m over emergency failings
(Sharecast News) - Gas distribution operators Cadent and SGN are to pay a total of £8m after failing to attend potential emergencies quickly enough, it was announced on Friday. Under rules set by regulator Ofgem, gas distribution network operators must attend reports of suspected gas leaks within one or two hours, depending on the circumstances, in 97% of all cases.
However, an investigation found that Cadent and both SGN's Scottish and Southern businesses had missed those targets a number of times between 2022 and 2023.
Both operators, which manage and maintain the network that delivers gas to homes and business, admitted the breaches, and have agreed to pay a total of £8m into Ofgem's Energy Industry Voluntary Redress Fund (EIVRF) as a result.
Cadent will pay £1.5m, SGN Scotland £700,000 and SGN Southern £5.8m.
Cathryn Scott, director of market oversight and enforcement at Ofgem, said: "The potential risk to households and businesses if gas leaks aren't investigated quickly is significant.
"We're confident the companies have improved their systems and processes to make sure this doesn't happen again and have demonstrated their commitment to this by meeting their targets in the two years since the breach."
Cadent said: "Despite our best efforts, the unforecastable level of demand on our emergency services during December 2022 meant that we missed the overall annual standard of service for two of our networks during 2022/23.
"Since the incident, we have led and industry-wide review of the root causes to try to ensure that such a situation does not arise again."
SGN said: "We take our responsibilities to meet our regulatory standards of service extremely seriously, and are deeply disappointed to have failed on this occasion.
"The cause was the availability of resources in key frontline roles compounded by a spike in cold weather in December 2022, which contributed to make a challenging situation worse."
The investigation covered Cadent's north London and north west regions, and SGN's Scotland and southern regions.
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