British Gas has been landed with a £1 million fine for misreporting how much renewable electricity it supplied to non-domestic customers under the Renewable Obligation. The error was made over seven years by British Gas Business, which supplies the company’s business customers.

Government’s Renewable Obligation (RO) requires utilities to provide evidence of the amount of electricity supplied from renewable sources. Renewable Obligation Certificates (ROC), designed to promote the use of renewable energy, depend on the accuracy of such information.

Ofgem confirmed British Gas Business had underestimated the total amount of electricity it sold to its business customers through the RO by 0.6% over the seven-year period from 2001-02 to 2008-09.

The regulator said British Gas’ error was caused by “incorrect interpretation of the reporting requirements, and insufficient procedures by the company”.

British Gas said it had brought the error to Ofgem’s attention.

Kanat Emiroglu, Managing Director of British Gas Business said, “We take any failure to meet Ofgem reporting obligations very seriously, and we are sorry this error has occurred.

“As soon as we discovered our misinterpretation of the reporting rules, we acted to bring this to Ofgem’s attention, and have worked closely with the regulator to address the problem and to ensure we fully comply with the reporting requirements in the future.”

David Pimm, Ofgem Group Finance Director said, “Energy suppliers who are presently submitting information to Ofgem for the 2010-11 Renewables Obligation period should also understand that the level of the penalty reflects both the importance of compliance and the significant co-operation of British Gas, including action to address the harm caused. Without this, the penalty would have been much higher,” he said.