OVO Energy has agreed to pay £8.9 million for issuing customers with inaccurate or incomplete information and overcharging them.
Ofgem’s investigation found the energy supplier – which has bought SSE’s retail business for £500 millon – sent inaccurate bills to more than 500,000 customers between July 2015 and February 2018, with many customers not receiving their annual statements.
In addition, around 10,000 customers were not given statements of renewal terms when tariffs were ending or were not moved to new tariffs when their existing tariff ended and 17,500 prepayment meter (PPM) customers were not initially charged at the correct regional level of the PPM price cap.
A further 8,000 PPM customers also ended up paying above the level of the PPM cap as a result of not being moved to new tariffs when their existing one ended.
Ofgem said OVO Energy did not self-report the majority of the issues despite being aware of them and was “slow to put things right”.
The supplier has now accepted the failings in its IT systems and compliance processes over five years resulted in too many customers receiving inaccurate or incomplete information and has agreed to pay the £8.9 million into a voluntary redress fund to help vulnerable customers.
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.”
OVO Energy has “apologised unreservedly” to those affected and said everyone who was overcharged has now been refunded.
It added in a statement: “We’ve always held ourselves to extremely high standards – so as soon as we discovered these issues, we worked tirelessly to put in place improved systems and practices. We’ve strengthened our team and put in place a number of policies, procedures and governance structures to make sure we meet all our regulatory obligations in the future.
“On top of that, we’ve invested in, and are rolling out, a new technology platform which improves overall customer experience. This will help us deliver market-leading information about our members’ energy use, helping everyone better understand their energy use, and receive clear and timely information about their bills.
“Throughout the whole investigation, we’ve worked really closely with Ofgem who’ve made it clear they welcome the approach we’ve taken to fixing things.”