OVO Energy to pay out millions in compensation after Ofgem probe
The UK’s fourth-largest energy supplier, OVO, has agreed to a £2.37m settlement following a regulatory investigation by Ofgem.
The energy watchdog uncovered significant delays in addressing customer complaints, with some unresolved for up to 18 months.
In addition, OVO failed to action the Energy Ombudsman’s rulings in certain cases.
As part of the settlement, the London-listed supplier will directly compensate 1,395 affected customers with £378,512.
An additional £2m will be paid to the Energy Industry Voluntary Redress Scheme, reflecting the serious consumer harm caused by the mishandled complaints.
Several major UK energy suppliers have been ordered to pay compensation to customers in recent years following investigations by the regulator, Ofgem, for failing to meet standards in customer service or billing practices.
In July Outfox the Market was forced to pay £1.8m to Ofgem for failing to provide essential financial data to the energy regulator, which had been ramping up its scrutiny of energy firms’ finances.
The challenger energy supplier, serving around 100,000 customers in the UK, repeatedly failed to provide “an appropriate level of detail” regarding its financial health.
In the end the company agreed to pay into Ofgem’s voluntary redress fund, which supports customers in vulnerable situations.
In April, Scottish Power was ordered to shell out £1.5m in refunds and compensation after overcharging nearly 1,700 households during the peak of the energy crisis and prior years.
This settlement followed an investigation by Ofgem, the energy regulator, which revealed that, between 2015 and 2023, Scottish Power incorrectly billed 1,699 direct debit customers at a higher rate intended for those who pay upon receiving their bill.
In July 2020, British Gas agreed to pay £1.73m in compensation after an investigation revealed failures in correctly charging customers who had switched to pre-payment meters.
The issues affected vulnerable customers, some of whom had been left without energy for extended periods.