OVO Energy and Good Energy to refund up to £180 to thousands of customers after overcharging issues – are you due cash?
TWO major energy companies will have to pay out £2.7million to thousands of customers who were overcharged.
The regulator Ofgem found Good Energy and OVO Energy charged over the maximum rates allowed under the energy price cap and energy price guarantee.
The energy price cap is set by Ofgem and limits the maximum amount suppliers can charge for each unit of energy.
It was put in place in January 2019 to stop customers being ripped off by firms.
In autumn 2022, the Government introduced the energy price guarantee to further protect households from soaring energy prices.
It is a subsidy that brings bills down to roughly £2,500 a year for the average household on a dual-fuel tariff.
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Good Energy was found to have overcharged nearly 7,000 customers a total of £391,650 between January 2019 and October 2022.
This was after the provider failed to adjust tariffs after customers changed their payment method.
Meanwhile, almost 11,000 OVO Energy customers were overcharged £1,492,917 between October 2022 and March 2023.
Affected customers will be automatically refunded so don't have to do anything.
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Good Energy customers will receive £109 on average while OVO customers will get an average of £181.
Good Energy will also have to pay a further £1.25million to Ofgem for failing to apply price protections to customers.
Meanwhile, OVO will have to pay £10,000 to the regulator for reporting issues.
Dan Norton, deputy director of retail at Ofgem, said: “Protecting consumers is always our top priority, and we expect suppliers to ensure customers pay no more than the level of the price cap or energy price guarantee – schemes put in place with the very purpose of helping people.
"It is totally unacceptable that Good Energy and OVO Energy customers were overcharged, particularly at a time that is already so challenging and stressful for consumers across the UK.
"Energy suppliers should hear this loud and clear: we expect suppliers to act with the utmost care and integrity.
"We will continue to hold them to account if they do not meet their customer protection or reporting obligations."
An OVO Energy spokesperson said: "We’re very sorry to some of our fixed-price customers who experienced a delay in receiving the energy price guarantee discount.
"We noticed immediately and self-reported the error to Ofgem.
"The issue has now been fixed and compensation has been paid as an apology.
"We have also made a voluntary contribution to the redress fund to help support customers in vulnerable situations."
Nigel Pocklington, chief executive officer for Good Energy, said: "We are very sorry that we let some of our customers down and promise to put things right.
"We have been contacting those impacted to apologise and issue their refunds and goodwill payments and will be fixing the issue so it does not happen again.
He added: "Every customer payment method change is now being checked and the formal improvement plan we have submitted to Ofgem includes new automated processes, standards and governance to prevent any similar mistake in future."
Grant Shapps, energy secretary, said: "The Government took unprecedented steps to protect households at a time when bills risked spiralling and families were dangerously exposed to volatile global energy costs as a result of Putin’s illegal invasion of Ukraine.
"It’s extremely frustrating to see in spite of these efforts some homes didn’t get the protection they deserved.
"It’s right these suppliers now pay the price for their oversight and offer redress to those wronged."
It comes after E.ON Next, Good Energy and Octopus Energy were forced to pay out millions of pounds to customers following compensation blunders.
Almost 95,000 E.On Next customers have been paid a total of £5.5million between them.
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Meanwhile, Octopus Energy paid roughly £750,000 out to 19,000 customers.
Good Energy paid a combined total of £18,000 to nearly 350 customers.