Drax: Auditor appointed to examine data around energy firm’s wood pellet supply chain
North Yorkshire power station operator Drax has announced that it has now appointed an external auditor, following an Ofgem investigation last year which led to the firm paying out £25m for “misreporting data”.
Energy regulator Ofgem announced in August last year that it had closed an investigation into Drax, having found that the company had failed to properly report data in relation to its sourcing of wood for biomass pellets, which are burned at the company’s Yorkshire site.
Following the investigation, Drax agreed to pay £25 to Ofgem’s Energy Industry Voluntary Redress Fund, as well as agreeing to commission an independent external audit.
Ofgem said at the time that there was no evidence the company had deliberately misreported its data.
The audit, which is the largest of its kind ever ordered by Ofgem, will examine biomass sourced and used across 98 per cent of Drax’s global supply chain.
Ofgem has also announced that it will publish the findings of the audit, upon its completion.
Neil Lawrence, Ofgem’s director of delivery & schemes, said: “Ofgem takes accurate reporting extremely seriously. The onus is on generators to meet their obligations in full, including how they report their data.
“Ofgem will not hesitate to take appropriate action if it reveals any compliance issues.”
The audit, which is being conducted by Forvis Mazars, is set to commence later this month, and will be paid for by Drax.
It will cover the period 1 April 2023 to 31 March 2024.
A spokesperson for Drax said: “We fully support this independent external audit process, working with Forvis Mazars and Ofgem, to add further rigour and transparency to our profiling data reporting.”
The announcement comes after the Financial Conduct Authority (FCA) last month opened an investigation into Drax’s statements around the sourcing of its wood pellets.
Drax said at the time that it would cooperate with the FCA.