E.ON ordered to pay £1.7mn in compensation
Ofgem finds energy supplier guilty of overcharging customers
By CFOWorld.co.uk staff | CFO UK | Published 14:30, 27 November 12
UK energy regulator Ofgem has found supplier E.ON to be guilty of overcharging customers and ordered it to pay a £1.7 million in compensation.
In an announcement on Tuesday, Ofgem said E.ON had applied wrong charges to customers after they switched energy providers in 2008 and 2011. As a consequence, the utility will have to repay around 94,000 customers an average of £14.83 in January, with the pay-out totalling in the region of £1.4 million.
Ofgem also ordered E.ON to pay another £300,000 into a fund aimed at helping pensioners in fuel poverty. The company accepted that it had incorrectly charged customers an exit fee when they switched suppliers following price rise announcements.
Additionally, E.ON also accepted a breach of a rule which states that customers who announce their intention to switch suppliers following price rise are exempt from being charged the higher price, even if the switch occurs after the price rise.
Sarah Harrison, senior partner (enforcement division) at Ofgem, said, “We have put in place protections for consumers so they can get a fair warning if their supplier puts up prices and time to shop around for a better deal. E.ON has accepted it failed to meet these protections.”
All major UK energy suppliers announced price rises ahead of the winter to much publish indignation. Earlier this year, Prime Minister David Cameron personally intervened and proposed legislation to force suppliers to provide every consumer with their least expensive tariff.
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