Tens of thousands of energy customers in the UK have received compensation after being overcharged by their supplier. The industry regular, Ofgen, found that more than 34,000 households were affected by this error between January 2019 and September 2024.
The problem mainly impacted customers with more than one electricity meter at their property. These homes, known as having “restricted meter infrastructure,” recorded energy usage through multiple meter points. Suppliers are allowed to add a standing charge for each meter.
However, Ofgem discovered that, in some cases, these charges and unit rates combined to push bills above the legal price cap.
Ten energy suppliers were found to have made this mistake. The companies involved were E.ON Next, Ecotricity, EDF Energy, Octopus Energy, Outfox The Market, OVO Energy, Rebel Energy, So Energy, Tru Energy and Utility Warehouse.
Octopus Energy had the highest number of affected customers, with more than 20,000 people owed refunds and goodwill payments. Utility Warehouse was also responsible for a significant number of cases, with over 8000 customers impacted.
The total amount paid out in refunds and compensation reached about 7 million euros. This included around 5.6 million euros in direct refunds and nearly 1.4 million euros in goodwill payments.
Octopus Energy alone paid out 2.6 million euros in refunds and over 546,000 euros in goodwill payments. Utility Warehouse refunded more than 2 million euros to its customers.
Ofgem launched its investigation after receiving reports that some customers were being billed multiple standing charges. The regulator said suppliers must ensure that no customer is charged more than the price cap, even if they have more than one meter. Ofgem expects all energy suppliers to have strong systems in place to avoid such errors.
Charlotte Friel, Ofgem’s director of retail pricing and systems, stated, “We must 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.”
Charlotte Friel, Ofgem’s director of retail pricing and systems, stated, “We have 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.”
All affected customers will receive compensation automatically. Those who have switched suppliers since the error occurred will be contacted by their previous provider to arrange a refund. Ofgem confirmed that all ten suppliers have updated their systems to prevent this problem from happening again.
