Under the Government’s Carbon Emissions Reduction Target (CERT) programme, large energy suppliers were able to distribute free energy saving light bulbs to British households.

E.ON said it had given out some 3.4 million free light bulbs in total, but had in fact included figures for light bulbs that were actually sold in the Republic of Ireland and not given out free in Britain.

E.ON will pay a £500,000 fine and £2.5m will go towards directly benefiting some of its most vulnerable customers.

The £2.5m package means 18,500 E.ON customers will receive £135 to help with their 2013/14 winter bills.

The payment will be made to E.ON customers who are eligible to receive Warm Home Discount Broader Group payments.

Ofgem said the fine reflects the serious nature of inaccurate reporting.

In response to the fine, Tony Cocker, chief executive of E.ON UK, said: “We’re sorry that these mistakes were made in 2010 and Ofgem has received a Board level assurance that the necessary changes have been made. Our controls should have been stronger and our processes more robust.

“It was important to us that, as part of putting this right, customers in fuel poverty or in a fuel poverty at risk group should receive a portion of the penalty we faced in the form of the additional payments we are making. We’re pleased that Ofgem agreed and has allowed us to do so.

“Overall energy efficiency obligations have been met, with the shortfall being made up by additional measures. No consumers were misled because of this mistake but this does not take away from the fact it was an error that should not have been made.”