Octopus Energy and Utility Warehouse are two of ten º£½ÇÊÓƵ energy firms directed by Ofgem to issue refunds and compensation to over 34,000 customers following an investigation that exposed widespread overcharging as a result of technical billing blunders.
Collectively, these firms must fork out £7 million—comprised of £5.6 million directly returned to customers and nearly £1.4 million in goodwill gestures, as reported by .
This has been prompted by an energy watchdog compliance review scrutinising pricing protocols associated with 'restricted meter infrastructure.'
The malpractice, which spanned from January 2019 to September 2024, involved residences with multiple electricity meter points employed for different usage categories, such as cheaper nighttime rates.
Although the application of several standing charges is allowed under such circumstances, Ofgem’s review established instances where subscribers were charged beyond the government's energy price cap, violating regulatory caps meant to shield consumers from exorbitant charges.
Ofgem's director of retail pricing and systems, Charlotte Friel, noted: "Our duty is to protect energy consumers, and we set the price cap so customers don't pay more than they should. While it's clear that errors were made, we welcome the swift resolution and refunds."
Friel continued, observing that the situation "serves as a reminder" to suppliers to rigorously adhere to the price cap regulations and maintain stringent billing processes.
Ofgem has pledged to remain vigilant, working with suppliers to ensure affected customers receive full compensation.
All ten suppliers implicated have since updated their systems to avoid any recurrence of such errors. While the regulator has not disclosed the complete list of suppliers, both Octopus Energy and Utility Warehouse have acknowledged their involvement.
The price cap, initially implemented in 2018, restricts the amount suppliers can bill customers on default tariffs per unit of gas and electricity, including standing charges.
This incident occurs amidst increasing regulatory examination of supplier billing methods, with Ofgem facing calls for stricter enforcement following a string of billing and switching issues within the industry over recent years.
