Three energy suppliers have been ordered to pay compensation to more than 100,000 customers after being rapped by regulator Ofgem.
E.On Next, Good Energy and Octopus Energy will pay a total of £8m after Ofgem accused them of "dragging their heels", by not paying fees that were due under rules put in place three years ago
The three firms have paid about £60 a customer affected by the missed payments, which are due if a supplier does not provide a final bill within six weeks of someone switching away. A further £1.7 million will be paid into Ofgem's 'voluntary redress fund', which supports charities to deliver energy-related projects, such as helping vulnerable energy consumers.
Read more: Energy bills could rise £30 for households to cover cost of customers who avoid paying
Ofgem's rules are designed to compensate households when switches are delayed or for errors made when switching, and this is the first time they have been used since being brought in three years ago.
Customers are entitled to a £30 payment each if a final bill is not produced in six weeks, with a further £30 payment if the compensation is not provided within another 10 working days. They households who have been compensated received the money because the firms failed to provide a final bill to customers within six weeks, after they had switched to another provider.
Ofgem said the firms either missed or delayed compensation payments worth £6.3million, with some of the affected households waiting over a year. E.On Next paid out £5.5million to almost 95,000 customers, while Octopus paid £750,000 to around 19,000 customers and almost 350 Good Energy customers received £18,000.
Neil Kenward, director for strategy at Ofgem, said: "Ofgem introduced these standards to make sure customers get the service they deserve when switching energy supplier. Our rules mean that where energy companies drag their heels, customers are automatically compensated. We won't hesitate to hold energy companies to account, as we have done today.
"As the energy market starts to recover, we'll likely see a return to more switching, and this action is a reminder to suppliers that they need to make switching as easy and convenient as possible for their customers, and where they cause undue delay, pay compensation swiftly."
Ofgem said the three suppliers have since updated their processes and systems to ensure final bills are produced within six weeks.
Who is affected
Customers who may have been affected include those who switched away from one of these firms in 2020 or 2021, and their final bill was sent after the six-week deadline.
What to do if you've not received compensation
All affected customers should have been paid by now, but if you don’t think you’ve received compensation, and believe you are eligible, you should contact the firm you were with to double check.
Read more:
- Little-known way to slash your water bills by up to 50% a year
- Experts warn of cost pitfalls if you fix your energy prices too soon
- Warning as families face bills to replace broken smart meter displays
- Confusion as £400 energy bills support for households comes to an end
- Energy supplier to wipe debts after payment glitch left customers with shock bills
