Octopus Energy will pay nearly 1.5 million euros in refunds and compensation after failing to issue final bills to more than 34,000 prepayment meter customers within the required six-week period, the energy regulator Ofgem has announced. The issue affected customers between 2024 and October 2023.
Ofgem found that Octopus Energy did not send final bills to the majority of these customers after they left the supply. This breach of Ofgem’s rules meant many customers did not receive notification of credit balances left on their accounts or refunds of that credit.
The total payment of 231,000 euros includes a refund for the remaining credit and 1.25 million euros in compensation for the delay and breach of guaranteed standards.
Beth Martin, Ofgem’s director for consumer protection and competition, said it is important customers get final bills so they know if they have credit to reclaim.
She stressed this is especially vital for prepayment meter customers, who are often more vulnerable and may be in financial difficulty. Ofgem praised Octopus for rectifying the error and compensating customers but said it will continue to monitor compliance closely.
Octopus Energy has over 7.5 million customers in Britain after acquiring Bulb and Shell’s home energy business. It became the UK’s largest supplier in January 2025.
However, Octopus criticized Ofgem’s final bill rules as “impossible” to implement in practice. The company explained that 60% of prepayment customers do not notify them when moving home.
Most customers use up their credit or leave it for the next tenant. Octopus also said it only has bank details for 10% of prepayment customers, and 70% of refund cheques go uncashed due to a lack of forwarding addresses.
Rachel Fletcher, Octopus’s director of economics and regulation, said the company’s approach has always been to do what is best for customers. Octopus charges prepayment customers about 70 euros less than the price cap, ensuring they are better off regardless of tenancy changes.
The company leaves any remaining credit on meters for incoming tenants and writes off debt when contacted by new occupants. These policies, Octopus claims, saved customers nearly 7 million euros more than if it had simply followed Ofgem’s billing rules.
Octopus complied with Ofgem’s demands to pay the compensation and update its billing processes to ensure final bills are now issued on time. The company has tried to contact all affected customers and used third-party tracing agents where needed. Any unclaimed funds will be paid to the Energy Industry Voluntary Redress Scheme, which supports vulnerable energy consumers.
Although Octopus Energy will pay 1.48 million euros in refunds and compensation to over 34,000 prepayment meter customers after failing to send final bills promptly.
While Ofgem emphasized the importance of final bills for customer protection, Octopus argues the rules are difficult to apply and prefers policies that keep bills low and help vulnerable customers directly.
