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Ofgem looks to cut UK’s £200m electricity theft

The proposals would require energy suppliers to work together to detect, investigate and prevent theft

ofgem logoOfgem has unveiled a series of reforms aimed at preventing electricity theft and ensuring consumers are not required to cover associated costs. Suppliers which fail to adhere could be subject to fines.

The electricity industry currently detects up to 25,000 instances of electricity theft per year, which cost consumers an estimated £200m or close to £7 per customer. Electricity suppliers estimate that one third of stolen electricity in the UK is used to power cannabis farms.

Andrew Wright, Ofgem chief executive, said: “Ofgem wants to make sure that consumers are paying no more than they need to for their electricity, and lives are not put at risk. It’s critical that suppliers do all they can to clamp down on electricity theft. This is why Ofgem is introducing new rules to encourage better theft detection.”

Suppliers to work together at national level

The proposals also include the creation of a national risk assessment service by relevant suppliers, to enable targeting of potential cases of theft.

Suppliers and network companies would also be required to create an industry code of practice regarding how investigations are run. Further obligations include working with the Home Office and local police forces to tackle any theft related to cannabis farms and the sharing of best practice across the electricity industry.

Getting customers involved

Ofgem is currently pressuring suppliers to create a 24-hour hotline to allow customers to report potential instances of theft. In addition, suppliers are required to present Ofgem with proposals for an initiative to incentivize consumers to report theft.

The deadline for responses to the proposal is 28 August and Ofgem expects to have the license condition in place at the start of 2014. The risk assessment service is expected to be operational in the first quarter of 2015.

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