Tens of thousands of energy customers with more than one electricity meter are in line for a share of £7 million in redress after the industry regulator found they were being charged more than the price cap on their bills.
The energy price cap is supposed to limit how much suppliers can charge out-of-contract customers for each unit of gas and electricity but a review by Ofgem found 34,000 have been overcharged by suppliers such as Octopus Energy, Ovo Energy and Utility Warehouse.
This issue specifically impacted those with restricted meter infrastructure between January 2019 and September 2024, which means they have more than one electricity meter point at their property recording energy usage.
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Energy suppliers add a standing charge to bills for each meter a household has and Ofgem’s review found that those with more than one were ending up with charges above the price cap.
Its review found 10 suppliers were charging too much and ordered them to pay £7 million in compensation.
This includes £5.6 million in refunds and almost £1.4 million in goodwill payments.
Charlotte Friel, director of retail pricing and systems at Ofgem, said: “Our duty is to protect energy consumers, and we set the price cap for that very reason so customers don’t pay a higher amount for their energy than they should.
“We expect all suppliers to have robust processes in place so they can bill their customers accurately. While it’s clear that on this occasion errors were made, thankfully, the issues were promptly resolved, and customers are being refunded.”
Why are energy suppliers paying refunds?
Ofgem said it began an investigation in response to reports that some customers were being hit with multiple standing charges.
It found that ten suppliers had incorrectly overcharged 34,048 customers with more than one meter by charging multiple standing charges.
This meant that in aggregate, the unit rates exceeded the price cap for varying periods of time between January 2019 and September 2024.
Ofgem said the suppliers promptly refunded customers and took remedial action, including compensating customers and have provided assurances that this will not reoccur.
The total redress is made up of £5,645,963.37 of direct customer refunds and £1,383,685.26 of goodwill payments.
How much redress will energy customers receive?
You will only get compensation if you have more than one meter and the review found your energy supplier was charging too much.
Customers will be refunded automatically, if they have not been already, and do not need to do anything.
If you have since changed supplier, your old provider should be contacting you to arrange a refund.
The amount of redress varies by energy supplier.
Ofgem data shows Octopus Energy has the highest number of customers affected with 20,862 owed £2,636,884.
Utility Warehouse also faces a big bill of £2 million for 8,272 affected customers.
Supplier | No. of customers | Total Refunds | Total Goodwill |
|---|---|---|---|
E.ON Next | 160 | £45,195.82 | £9,330.33 |
Ecotricity | 166 | £36,633.12 | £18,904.35 |
EDF Energy | 3 | £112.29 | £30.00 |
Octopus Energy | 20,862 | £2,636,884.00 | £546,278.00 |
Outfox The Market | 570 | £6,106.06 | £4,590.00 |
OVO Energy | 2,372 | £602,066.05 | £280,068.73 |
Rebel Energy | 15 | £2,339.49 | £575.00 |
So Energy | 1,558 | £266,041.16 | £58,285.85 |
Tru Energy | 70 | £7,486.54 | £11,663.00 |
Utility Warehouse | 8,272 | £2,043,098.84 | £453,960.00 |
Total | 34,048 | £5,645,963.37 | £1,383,685.26 |
Friel added: “Today’s outcome serves as a reminder to all energy suppliers that they must implement the price cap properly and do their due diligence. It also shows that, where appropriate, Ofgem is prepared to work with suppliers that fail to comply with our rules.”
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