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Ovo Energy has agreed to pay £8.9m for issuing
inaccurate or incomplete information to customers, and for
under and overcharging customers due to IT
issues.
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These breaches occurred while Ovo did not put enough
attention on ensuring its processes and governance were capable
of complying with Ofgem’s rules.
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Ovo Energy has since put in place measures to make sure
this doesn’t happen again, including investments in technology
and implementing appropriate compliance
procedures.
Ovo Energy has accepted that, for a period of over five
years, failings in its IT systems and compliance processes
resulted in too many customers receiving inaccurate or incomplete
information.
Ofgem’s investigation found:
- Inaccurate annual statements were sent to more than
500,000 customers during the period of July 2015 to February
2018. Many customers did not receive an annual
statement;
- Ovo Energy underestimated consumption over one winter,
meaning customers were under or overcharged;
- 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;
- 17,500 prepayment meter customers were not initially
charged at the correct regional level of the prepayment meter
cap; a further 8,000 customers ended up paying above the level of
the prepayment meter cap due to Ovo not moving them to new
tariffs when their existing tariff ended;
- Some of these errors led to customers being over or
undercharged.
Ovo Energy did not self-report the majority of the issues
despite being aware of them and was slow to put things
right.
Ovo Energy now accepts and has corrected these breaches,
including refunding its customers affected by overcharging on the
prepayment meter cap. It has also written off all amounts owing
from customers who had been charged at the wrong
rates.
It has agreed to pay £8.9m 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.”
Notes to editors
For more information on the findings of our investigation
see Investigation into
Ovo and its compliance with its obligations
under the gas and electricity supply licences, Standard Licence
Conditions 31A and 25C (SLC 0 from October 2017), SLC 22C, SLC
26, and SLC 27 and SLC 28A
