According to the announcement from the industry regulator, energy giant SSE will pay £9.8m for violating its generation license.
The Perth-based business overcharged the National Grid Electricity System Operator during a "transmission constraint," according to Ofgem.
When this happens, operators are compensated to reduce output if the network is unable to remove power from a region where generation exceeds demand.
There is no proof, according to Ofgem, that SSE's actions were intentional.
In order to increase and decrease the amount of electricity produced by various generators during transmission constraints, the electricity system operator manages flows across the network.
However, there is a chance that generators will take advantage of their position by raising prices and lowering output, and Ofgem has put rules in place to stop this.
In October 2021, Ofgem opened an investigation into SSE's conduct at the Foyers pumped storage power station in North Ayrshire.
Including during times of transmission constraint, it was discovered that SSE increased the bid prices it charged the electricity system operator to lower output "significantly.".
Despite the lack of evidence that the action was deliberate, Ofgem stated that SSE broke the established rules.
The pricing actions would ultimately result in higher costs for consumers, the document warned.
Ofgem's Cathryn Scott, director of enforcement and emerging issues, stated: "Protecting consumers is a priority for Ofgem, and we will continue to monitor and ensure the integrity of the wholesale energy markets in Great Britain on behalf of energy users.
"This enforcement action sends a strong signal to all generators that they must implement controls to ensure that their bid prices are set in a way that ensures that they do not receive excessive benefits during transmission constraint periods," the statement reads.
They will experience serious repercussions if they don't comply. ".
Since then, SSE has promised to implement a new pricing scheme intended to fairly account for the expenses and advantages of lowering its generation at Foyers.
The company's early settlement of the investigation allowed Ofgem to reduce SSE's fine from £11.58m.
