Cadent acknowledges historical issues and commits to renewing customer trust

Corporate

  • Cadent apologises to customers in London for delays in getting their gas back on and acknowledges historical missing records
  • Cadent has responded to redress the issues
  • Under new ownership, Cadent is transforming its business to put the customer at the heart of everything it does
  • Cadent is establishing a new £20million community fund
Cadent, today (22/05/19) acknowledged historical service-related issues and has issued an unreserved apology to customers who have been affected.  We have been working closely and constructively with Ofgem over the last 12 months to ensure that these past issues are rectified.
 
Steve Hurrell, chief executive officer, said “We aim to put customers’ needs at the heart of everything we do, and we acknowledge that in the past, we have fallen short of customer expectations and the higher standards we have now set ourselves; for this we are sorry.
 
“It is important within the energy sector to have a strong regulator to ensure customer interests are protected and we are working closely with Ofgem to restore confidence in us and build trust in our future plans. 
 
"While Cadent is a relatively new business, some of its record keeping processes and practices go back many decades, and a number of the issues we are addressing today are a legacy of that past.  We are taking the opportunity to reshape the company to set new standards of customer experience and are investing significantly through our community fund to reach those customers in the most vulnerable situations.”

The issues and solutions

  • Historical records of high-rise buildings1:  In early 2018, we discovered a number of high-rise residential buildings were not registered on Cadent’s records and therefore not part of the rolling programme of surveys.  The problem was caused by the quality of historical data, relevant to these buildings, dating back decades.  We immediately undertook a programme of additional surveys, all of which were completed by September 2018, when our database was updated, and processes to ensure that our records remain accurate were established.   We accept we have fallen short of certain conditions of our licence and have agreed to make a £3m payment to the Energy Savings Trust in recognition of the impact this had. 
  • Past delays of compensation payments:  We have discovered that a small proportion of our customers did not receive compensation payments for being ‘off gas’, for more than 24hrs, as quickly as they should have.  We have introduced new administration procedures to ensure all future payments are made promptly.  
  • Time ‘off gas’:  When we disconnect gas for essential safety work, it is our policy to get our customers back ‘on gas’ as quickly as possible.  However, some of our customers in high-rise blocks of flats in London have been without gas for longer than was desired.   We have now established a new team dedicated to minimising the number of customers we need to take off gas and, when disconnection is unavoidable; will ensure enhanced support is available.
To recognise the impact of these three issues, Cadent will make a total payment of £8.9m 2 to the Energy Savings Trust to support its important ongoing work. 
 
Cadent has already invested £3.6m in the investigation and additional surveys necessary to address the problem with our records; and we are investing a further £2.3m a year in the new team dedicated to minimising the impact of interruptions to gas supplies across our networks, in particular London.

Our commitment to our customers

We are starting this transformation journey by first listening to our customers and understanding their needs.  This will allow us to transform our business by simplifying Cadent for our customers and our people.  We will address every area of our business - from customer service and data, to how we deliver our field operations.  We will ensure that accountability and decision making is devolved to the four regions we cover for the benefit of our customers.
 
As part of the commitment to our customers, we are increasing compensation payments3 and are setting up a community fund4 to support communities, customers and particularly those in vulnerable situations.
 
Steve Hurrell, chief executive officer, said: “We know the vital role Cadent plays in transporting gas across our network to keep customers safe and warm.  We are also aware that, increasingly, consumers expect businesses to play a role in helping communities flourish. This is particularly true for utility companies given the essential services they provide. Our board has been working to identify the best way for Cadent to demonstrate this wider corporate and social responsibility.  The community fund we are establishing is ground-breaking in its commitment to support the communities we serve.”

 
Media Contact:

Sara Wilcox

Cadent Media Relations

07899 983792
Sara.wilcox@cadentgas.com

Notes to editors:

1 Cadent defines ‘high-rise’ as buildings of six storeys or more.

2 £3m of this payment recognises the issue with our records of high-rise buildings.  The remainder is a contribution to the work of the Energy Savings Trust.
 
3 Under the gas industries’ guaranteed standards of service the following compensation arrangements apply: 
  • Properties used for domestic purposes only, will be entitled to £30 for every complete 24 hour period without gas up to the point at which we first visit the property to reconnect the supply, capped at £1,000.  From 1 April 2019, payments will double and the £1,000 cap will be removed.
  • Properties used for non-domestic purposes only (e.g. factories), will be entitled to £50 for every complete 24 hour period without gas up to the point at which we first visited the property to re-connect the supply, capped at £1,000.From 1 April 2019, payments will double and the £1,000 cap will be removed.
4Cadent will be investing annually 1.25% of its after-tax profits in a new Cadent Community Fund.  The fund will be independently chaired to ensure complete transparency.
The details of the community fund is currently being finalised and will be launched later this summer.
 

Cadent

Cadent is the UK’s largest gas distribution network with a 200-year legacy.  We are in a unique position to build on strong foundations whilst encouraging the curiosity to think differently and the courage to embrace change.  Day to day we continue to operate, maintain and innovate the UK’s largest gas network, transporting gas safely and protecting people in an emergency.   Our skilled engineers and specialists remain committed to the communities we serve, working day and night to ensure gas reaches 11 million homes from Cumbria to North London and the Welsh Borders to East Anglia, to keep your energy flowing. 

Cadent manages the national gas emergency service free phone line on behalf of the gas industry - 0800 111 999*

Cadent Gas Ltd is majority owned by a consortium of global investors.

*All calls are recorded and may be monitored.

Media contacts

Stephanie van Rosse

stephanie.van-rosse@cadentgas.com

01455 231 131