Energy companies ordered to return millions to customers

Post by Kevin Jackson on 28th February 2014 in General industry

Energy companies ordered to return millions to customers

Funds lying in accounts of people who pay for their energy by direct debit have been ordered to be returned to customers by the industry regulator, Ofgem.

It estimates that energy suppliers are sitting on more than £400 million in customers' cash in the form of overpayments made under the providers' monthly payment schemes.

Ofgem said this morning it considered this amount to be "unacceptably large", and believed that refunds could be due for up to 3.5 million households and 300,000 businesses.

Andrew Wright, Ofgem chief executive, has called on the energy companies to "do the right thing and do all they can to return this money and restore customer trust".

Most of the money is held in old accounts where customers have changed address.

At the same time, Sarah Harrison, senior partner in charge of enforcement at Ofgem told BBC Radio 4's Today programme that the regulator was at the same time urging customers not to lose out, and to "make sure that you take with you what is owed to you when you change supplier".

Energy UK, the trade body for the supply companies, claimed however, that a lack of forward contact details or of next of kin often made it difficult to match up credit balances with the person due the money.

It added: "More commonly, energy companies are owed many times more money by people who leave unpaid debts behind."

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