Ofgem makes Good Energy pay out £150,000 to customers for billing failures

Good Energy has been made to pay £150,000 in compensation and redress after it failed to give final bills and refund credit to more than 2,000 prepayment meter customers.

Energy regulator Ofgem said 2,284 customers on prepayment meters were affected by an error with Good Energy’s billing system between 2014 and October 2023.

It meant that prepayment customers who switched to another supplier or ended their contract with Good Energy did not get a final bill within six weeks, as required by the watchdog.

Good Energy paid out £150,067 as a result, with the average sum per customer standing at £66.

The figure includes £55,281 in compensation and refunds and £94,786 to the industry’s voluntary redress fund, which supports vulnerable customers.

The issue was identified after energy supplier E.On Next self-reported the same error to Ofgem last year.

A detailed investigation followed, and Good Energy has now updated its systems to rectify the error, Ofgem said.

Beth Martin, director for consumer protection and competition at Ofgem, said: “At a time when so many households are facing financial difficulty, it’s unacceptable that Good Energy failed to provide refunds of money that was owed to customers, compensation they were due, and final bills they were entitled to.

“Driving up standards for consumers across the board is our top priority, and improving billing accuracy is a key part of this.

“We also expect suppliers to make sure they have robust systems in place to limit the risk of issues like this happening, and to proactively report problems when they arise.”

Good Energy chief executive Nigel Pocklington said: “We were dismayed to find the billing system issue causing these prepayment customers to have not received their final statements and we deeply apologise to all those affected.

“As soon as the issue was identified we put in place a manual process to ensure it did not continue and have since made changes to make sure it does not happen again.

“We have also made every effort to provide due compensation to affected customers. This includes goodwill sums in excess of their potential credit balance plus interest, and the general standards of performance payments all customers who do not receive final statements in time.”

Last month, the boss of Ofgem said he wanted to be less “heavy handed” in policing energy firms, including only taking enforcement action in “serious cases” of companies failing customers.

Jonathan Brearley said he wanted to take a “proportionate, intelligent” approach to regulating customer issues in the coming years.

He said: “The fact is that over the last few years Ofgem has had to intervene in light of poor services and poor practice for some suppliers.

“However, I also recognise that at times, our past approach has been unwieldy, potentially heavy handed and bureaucratic.”

But he added that firms need to “do more than the regulatory minimum” in return.

That includes by providing faster redress payments for issues like poor smart meter installation services or incorrect billing.