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Two energy suppliers to pay over £9m for overcharging customers

Joanna Faith
Written By:
Joanna Faith

Ovo Energy has been fined £8.9m by the regulator Ofgem for overcharging customers, while Utility Warehouse will pay out £200,000 for the same reason.

Ovo Energy has agreed to pay £8.9m for sending inaccurate statements to more than 500,000 customers between July 2015 and February 2018.

Some Ovo customers didn’t receive an annual statement at all.

Ofgem said Ovo, which is about to take on an additional 3.5 million customers from SSE, was aware of these issues but did not report them and was slow to put things right.

Ovo has accepted and corrected these breaches and refunded customers affected by overcharging.

Anthony Pygram, director of conduct and enforcement at Ofgem, said: “Ovo Energy billed a number of its customers incorrectly and issued them with inaccurate information.

“The supplier did not prioritise putting these issues right whilst its business was expanding.

“Our enforcement action sends a strong message that suppliers must get basic services right for all their customers. Ovo Energy has accepted the breaches and put processes in place to comply with the rules in future.”

Meanwhile, Utility Warehouse is to pay £200,000 into Ofgem’s voluntary redress fund after it overcharged thousands of Warm Home Discount customers due to a technical error.

The supplier will also refund and compensate all customers to the tune of £450,000.

In December 2019, Utility Warehouse discovered that 3,430 of its customers who receive the Warm Home Discount payment, but pay for their energy when they receive a bill, were paying above the correct default tariff cap level between January and November 2019.

The supplier reported the issue to Ofgem and updated its systems.

It confirmed it was in the process of issuing full refunds to all affected customers.

A statement from Ovo said: “OVO Energy holds itself to high standards, but we have not always got it right. We accept Ofgem’s findings of issues regarding estimation processes, information formatting and pricing errors.”

A Utility Warehouse spokesperson said: “A small number of affected customers were mistakenly categorised within the price cap, which led to an overcharge.

“As soon as we realised the mistake we reimbursed them for the overcharge, gave them an additional credit on their account and put them onto the correct tariff.”