Ofgem has this morning charged 18 energy suppliers, including British Gas, Shell, and Scottish Power, a combined £10.4m for overcharging their customers.
In total, over 1m customers were wrongly charged £7.2m for firms’ failures to correctly protect customers’ tariff prices when they decided to switch supplier or tariff.
The watchdog said that most of the failures were down to suppliers not having adequate arrangements in place to make sure the protections were applied in full when customers decided to switch.
The suppliers have since agreed to refund all affected customers, and in some cases make goodwill payments.
Where it has not been possible for refunds to be given, the companies have paid into Ofgem’s redress fund.
The worst offender was challenger brand Ovo, which overcharged 240,000 customers a total of 2m. The firm has paid out over £2.8m in compensation for the error.
Shell, British Gas, and Scottish Power have all also paid back over £1m in remediation.
Anna Rossington, interim director of retail at Ofgem said: “Customers should have confidence in switching and not be overcharged when doing so.
“This case sends a strong message to all suppliers that Ofgem will intervene where customers are overcharged and ensure that no supplier benefits from non-compliance.
“It also shows that, where appropriate, Ofgem is prepared to work with suppliers who have failed to comply with the rules, but who are willing to self-report issues and put things right for their customers.”