Little Barford power station operator RWE has agreed to pay out £4.5 million following last summer’s massive electricity failure which left more than one million customers across the country without power and thousands of rail passengers marooned.
The money is part of a bill totalling £10.5 million which power organisation have agreed to pay into a special voluntary redress fund, run by power watchdog Ofgem, to help customers following the near collapse of the system after a lightning strike on August 9.
An investigation by Ofgem concluded that Little Barford did not remain connected to the grid when it should have done after the lightning strike, along with the Hornsea One offshore windfarm which also made a voluntary payment of £4.5 million. UK Power Networks agreed to pay a further £1.5 million for a technical breach of the regulations.
Trouble started when a power circuit which passes through St Neots was hit by lightning, triggering a chain of events which led to systems closing down.
Ofgem executive director Jonathan Brearley said: "Consumers and businesses rely on generators and network companies to provide a secure and stable power supply. August 9 showed how much disruption and distress is caused to consumers across the UK when this does not happen."
He said: "That is why it is right that companies that were unable to keep generating have paid into our customer redress fund.
"Our investigation has raised important questions about the National Grid's Electrical System Operator which is why our review will look at the structure and governance of the company."
Mr Brearley added: "As the energy market changes it is vitally important we futureproof the networks to ensure customers continue to benefit from one of the most reliable electricity systems in the world."
Ofgem is currently carrying out a review into the structure and governance of the Electricity System Operator and is expected to report later this year.
Little Barford and the other power station resolved technical problems quickly after the lightning strike, but there was not enough back-up power in the system which led to networks being turned off automatically to prevent wider-scale disruption.
RWE said: "RWE has fully cooperated with Ofgem in their investigation into the power outage that occurred on the 9th August. RWE acknowledges that its Little Barford gas fired power plant was unable to remain on the system and generate power following the lightning strike on the transmission line.
"The technical issues were unforeseen but quickly resolved. However, combined with the loss of another large generator, and significant generation at a local level, these power losses went beyond the reserves being held by the Electricity System Operator. The unexpected outage at Little Barford was therefore one of the many contributory factors in the loss of system frequency and subsequent demand disconnections, which unfortunately caused widespread disruption."
Tom Glover, RWE UK country chair, said: "RWE is proud of the reliability of its fleet in the UK. However, the events of August 9, including the lightning storm, were particularly challenging for the whole power network to cope with.
"RWE is committed to providing secure, clean and affordable electricity. We are making a significant voluntary contribution of £4.5 million to Ofgem's redress fund, which will go towards helping energy consumers."
Mr Glover added: "The event raises questions regarding how the wider system should be designed and operated to be more resilient. We therefore look forward to working with all parties on a broader review of system resilience."