E.ON fined £7.75m for overcharging customers

E.ON has been hit with a multi-million pound fine for incorrectly charging its customers – for the second time. The Big Six supplier was ordered to pay £7.75 million by […]

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By Priyanka Shrestha

E.ON has been hit with a multi-million pound fine for incorrectly charging its customers – for the second time.

The Big Six supplier was ordered to pay £7.75 million by Ofgem for overcharging customers following price rises and incorrectly charging exit fees.

Under the regulator’s rules, suppliers have to give customers 30 days’ notice of a price rise, giving them a chance to switch before the increase comes into effect. If a customer wishes to move suppliers within that month, they don’t have to pay exit fees or the higher price even if the switch occurs after the rise.

E.ON failed to follow the rules in January 2013 and January 2014.

The energy firm has already paid back £400,000 to direct debit and standard credit customers who were affected.

However, it has yet to pay back around 7,000 customers on prepayment meters who were also affected and hopes to refund them by the end of April.

Sarah Harrison, Senior Partner in charge of enforcement said: “E.ON’s errors meant customers who took the chance to switch were wrongly charged. It is important that E.ON has repaid potentially affected customers and cooperated with the investigation.

“However it’s absolutely unacceptable that E.ON failed to provide these vital customer protections yet again and this persistent failure is the reason for the high penalty.”

The £7.75 million will be paid to non-profit organisation Citizens Advice to support its programme that provides face-to-face energy advice.

E.ON said in a statement: “The company sincerely apologises to those affected.

“E.ON is committed to ensuring that no one will lose out financially and is pleased that the payment is going to a worthwhile cause that will provide support to those in need.”

It made the same billing error in 2012.