Bristol-based Ovo Energy has been fined £8.9million by the industry regulator for overcharging customers and sending out inaccurate statements.
The supplier sent out annual statements with the wrong information on to more than 500,000 customers, according to the Ofgem ruling.
The problems, which also include Ovo undercharging some people, were caused by issues with firm's IT system and took place between 2015 and 2018.
Ovo says it has since put measures in place, such as investments in technology and implementing appropriate compliance procedures, to make sure the same errors do not happen again.
The regulator claims Ovo was aware of the problems, did not self-report the majority of the issues and was slow to put things right.
Ovo customers who were affected by overcharging have since been refunded and the supplier has also written off all amounts owing from customers who had been charged wrong amounts.
The fine will be paid into a voluntary 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.
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“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.”
Ovo said in a statement: "Since the day we were founded, serving our customers has been our number one priority. We strive to give them the best experience by working hard to provide the latest digital innovations and excellent service.
"We have pioneered a new business model for the industry and have constantly innovated to simplify energy for our customers.
"OVO Energy holds itself to high standards, but we have not always got it right. We accept Ofgem’s findings of issues regarding estimation processes, information formatting and pricing errors.
"We are proud of our record. In particular, during the time these infringements occurred, we were voted Uswitch Supplier of the Year four out of five times and achieved a customer satisfaction score of 96 per cent - the highest in the survey’s 11 year history at the time.
"We will continue to be guided by the current and future needs of our customers and will keep innovating towards a zero carbon world."
The news comes just weeks after Ovo sealed a massive deal with a rival supplier which will mean millions of people are switched over to them.