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Ofgem orders Npower to pay £26m fine over billing failures

By Energy Company Numbers on December 18, 2015 in Help and advice, npower
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  • Npower failed 500,000 customers from 2014-15;
  • The supplier sent out unitemised bills and wrongly calculated bills;
  • The supplier failed to handle complaints effectively;
  • The supplier has been ordered to pay a £26m fine by Ofgem.

The energy regulator Ofgem has ordered Npower to pay a staggering £26m fine over customer service failures today.

More than 500,000 customers had been affected by Npower’s billing failures, which date back to 2011, and Ofgem have ordered Npower – one of the Big Six – to pay a £26m fine.

The fine will be split up to repay customers affected by Npower’s billing failures with an undisclosed amount going to charity.

Npower’s billing failures

Npower sent over 500,000 customers late bills and inaccurate bills during the period September 2013 to December 2014. The bills had little to no information breaking down charges, something that energy suppliers must do. Many of the customers affected by this billing fiasco complained to Npower, however the supplier failed customers here too. The supplier did not refer all customers to its complaint handling procedures. They also failed to tell all customers that they could take their complaints to the energy ombudsman if their complaints were not resolved within eight weeks.

Ofgem became involved when they got wind of these breaches in service.

Related: RWE Npower customer service performance in 2015

Npower’s billing failures were the result of a poorly executed IT system that was designed and installed in 2011. The system was supposed to automate the billing process as much as possible, to free up internal resources. However, we now know that the system was a disaster for customers and the supplier.

On Npower’s £26m fine, Ofgem chief executive Dermot Nolan said: “Npower failed its customers. Not only have its billing and complaint handling procedures been chaotic, it treated many of its customers poorly, which is completely unacceptable.”

He added: “The payment of £26m sends a strong message to the industry that we expect them to act quickly and effectively to ensure a good customer experience.”

Were you affected by Npower’s billing failures?

If you were one of the 500,000 customers affected by Npower’s billing failures, you may be in line for compensation from the supplier. You will contacted by Npower if you are. Ofgem will be keeping a close eye on Npower to ensure that their fine is paid in full and to the right people. If you believe you should receive compensation for Npower’s failures and you have not been contacted by the company, you can find Npower contact information here.

Alternatively, you may wish to contact the energy ombudsman.

About the Author

Energy Company NumbersView all posts by Energy Company Numbers
Energy Company Numbers is a telephone number directory service dedicated to helping UK consumers keep in touch with their energy suppliers.

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