Littleborough residents not entitled to compensation after days of no power

When Storm Arwen hit Greater Manchester with gale-force winds and heavy snow last November, it left tens of thousands of homes without power.

The vast majority were able to claim compensation – £70 for each day without electricity up to a maximum of £700 – from Electricity North West,  the region’s power network operator.

But that was not the case for the unfortunate residents of Hollingworth Lake Caravan Park, in Littleborough, Rochdale.

Residents went nearly three days without access to their usual power supply for cooking and heating, and were forced to throw away food they had kept in their freezers – yet are not entitled to a compensation pay out.

Once things were resolved, one local resident, Neil Moores, approached Electricity North West for his share of the compensation to cover expenses caused by the cut in his supply.

Mr Moores, 67, who has lived at the site with wife Linda for 22 years, was surprised to learn that, despite paying hundreds of pounds a year for his electricity, only the person who owns the caravan park was entitled to a compensation payment, leaving residents out of pocket.

Following a conversation on the doorstep with ward councillor Tom Besford, a campaign was started to highlight this issue which impacts thousands of people living on caravan sites, waterways and other private settings with similar power arrangements.

Private network requirements are owned by BEIS and were set up to create 'proportionate regulation' that doesn’t overburden small distributors such as caravan parks. Instead of each resident being connected directly to the Distribution Network Operator (Electricity North West) only one customer - the site owner - is connected to the network and the park homes connected to the private network owned and operated by the site owner.

Many park homes are connected to a private network that is owned and operated by the residential park owner or operator.

Mr Moores said: “The power was off for 66.5 hours in sub-zero temperatures. There are 38 residents on the park, most of whom are elderly. Thankfully because of the alternative sources of heating, cooking and lighting put in place by the able bodied, site owners and the local council, we avoided any fatalities.

“Our electricity bills averaged around £200 per quarter at the time of the power cut. Without this loophole, we should have been eligible to a compensation payment of £140 each. This would have helped to cover our losses including freezer contents and for the hardship we all went through.”

Someone who very much shares his sentiments is fellow resident Maureen Atkinson.

“It was extremely hard – so not to get any compensation from it when other people have, it just doesn’t seem fair,” she says.

“It was terrible to be honest with you – very cold and then all the food in the fridge had to be thrown away. I was wrapped up in blankets, had my coat on – and had a hot water bottle I had found.”

Maureen, who sadly lost her partner shortly before the storm hit, adds: “It was really quite a nightmare. And for me it was the first time something like that had happened and I was on my own.”

She estimates she lost at least £100 worth of food – and claiming on her insurance would not have been worth it, once the excess was taken into account.

The Local Democracy Reporting Service understands that the site owner was able to claim £140, but not a lump sum to cover everyone living at the park. They are currently talking to the industry governing body about distributing the money, as tenancy types – owners, visitors and renters –  vary on the park.

On the back of this, Rochdale’s MP Sir Tony Lloyd wrote to the government to request a change in the legislation to make things fairer. However, the response from the Minister of State for Business, Energy and Clean Growth, Greg Hands shows that no further action is planned, despite recognition that this loophole exists.

In his response, Mr Hands wrote: “Ofgem sets the Quality of Service Guaranteed Standards that must be met by each electricity network company. These standards have been set to a level of service that it is reasonable to expect companies to deliver in all cases. Customers are entitled to compensation if distribution companies fail to meet the service standards required.

“Mobile park homes are connected to a private network that is owned and operated by the residential park owner or operator, instead of being connected directly to the local Distribution Network Operator network. In this situation, the Distribution Network Operator only has one customer directly connected to their network – the private network owned by the residential park owner.

“Under the Guaranteed Standards of Performance, Distribution Network Operators are only required to make payments for supply interruptions to customers that are directly connected to their network.

“Private network operators are not required to make payments to their customers under this scheme. The current compensation rules were set in April 2015 for the duration of the current price control period, which runs from 1 April 2015 to 31 March 2023, and cannot be changed.

“I understand that Ofgem is in the process of considering the arrangements for the next price control period, which starts on 1 April 2023, and as part of this they will review the eligibility criteria for compensation claims due to power disruptions.

“It may be useful to know that the Energy Ombudsman has been approved by Ofgem to independently handle and resolve disputes between customers and energy companies. If they feel that their energy company has not appropriately handled and resolved their complaint, they can refer this to the Energy Ombudsman.”

Councillor Besford said: “For the residents of Hollingworth Lake Caravan Park and many hundreds of others across the region, this whole thing is deeply unfair. They pay their bills just like anyone else, but because of the quirk of the system, are not entitled to compensation when the supplier isn’t able to keep the power on.

“I call on the government and Electricity North West to do the right thing and properly compensate some of the most elderly and vulnerable residents in our community.”

A spokesperson for Electricity North West said: “Under Ofgem’s current rules, bill payers with a direct relationship to an electricity supplier fund the power network so it would be those who are entitled to the compensation when there are long power cuts.

 “If a consumer such as a tenant in a house share or caravan park is not the direct bill payer to the supplier, then it is up to the person who pays the supplier direct to share any compensation with tenants.

 They added: “We would encourage any business where this is likely to be an issue to discuss in advance what they will do so the situation is clear to their residents, and then all can consider what steps are appropriate to take including sharing any compensation that might be paid or, other alternative arrangements for instances such as extreme weather where prolonged power cuts can occur.”

A spokesman for the Department of Business Energy and Industrial Strategy said it was ‘unacceptable that thousands of homes were left without power for so long as a result of Storm Arwen’.

They continued: “Action is being taken, with energy regulator Ofgem considering the arrangements for the next price control period from 2023, including a full review of the eligibility criteria for compensation claims due to power disruptions.”

Reporting: Rochdale Online

Additional reporting: Nick Statham, Local Democracy Reporting Service