Ofgem Takes Action As British Gas Business Ordered to Pay £5.6m Back to Energy Customers
The commercial unit of British Gas has made payments of £5.6 million back to business energy customers, after it admitted to significant errors regarding renewals and its switching process.
The regulator Ofgem had discovered that British Gas Business had been stopping firms from switching to an alternative energy supplier and also failing to inform their customers when they were nearing the end of their contract, therefore rolling them over to often pricier deals.
Penalty Paid to Customers and Into Energy Efficiency Fund...
British Gas Business has paid around £1.3 million back to the business energy customers who had been affected and an additional £3.45 million will be paid into an energy efficiency fund. On top of this, an £800,000 penalty will be due for the breaching of fair play regulations.
Ofgem had come under scrutiny during 2013 for failing to live up to its promise of reforming the “broken energy market”, but steps such as this and their inquiry into the Big Six energy suppliers, will have given to hope to many domestic and business energy customers across the country. Switching easily and fairly had been earmarked by Ofgem as essential to a well-functioning energy market and British Gas Business have clearly been operating in contravention to this ethos.
“It is fantastic to see that Ofgem is staying true to its word and ensuring that all domestic and business energy suppliers toe the line when it comes to being open and transparent. The energy market is only going to fix itself when all suppliers act with equality in mind and treat all customers as fairly as possible. Today’s news is a great signal that the regulator is going to enforce just that, let’s hope all suppliers take heed for the good of the consumer” stated Love Energy Savings Managing Director, Phil Foster.
British Gas Business Acted Swiftly...
The energy supplier have been given some credit in the fact that they dealt with the issues very swiftly and remedied the issues as quickly as possible; all businesses that had been adversely effected have been reimbursed. Due to their full co-operation during the investigation, it is thought that their settlement package is a lot lower than if they had not acted in the appropriate manner.
British Gas Business have said that they are “sorry” for the errors that have taken place.
Between 2007 and 2012, British Gas Business had made a large number of objections to business energy customers wanting to move to a cheaper supplier, 5.6% of these were discovered to be invalid. The reason for this has been attributed to errors with their computer systems and the processes and controls involved in making these decisions being far from up to scratch. These errors were then compounded by the fact that British Gas Business did not correctly communicate with their business energy customers when giving reasons for their objections.
Ofgem also conducted a separate investigation into the notice non-domestic energy customers were being given before their contracts were being automatically rolled over. They found that roughly 1,200 business energy customers, of which the majority were micro businesses, had been denied the opportunity to get a better deal through shopping around or using energy comparison sites. Instead, they either continued on the same tariff with British Gas Business or were even put onto a standard tariff which is often even more expensive.
If you are at all worried about your business gas and electricity prices, then why not get in touch with Love Energy Savings today? We are in impartial energy comparison service and can find you the very best price and even get you switched over to a better tariff completely free of charge! Just click the banner above or you can call our team of home and business energy specialists on 0800 988 8375.