Energy company to pay thousands to customers after 'failure'

The energy firm has been hit with a £2.37 million penalty by the industry watchdog for complaint handling failures

Nearly 1,400 Ovo customers are set to be compensated after the energy firm was slapped with a £2.37 million fine by the industry watchdog for failing to handle complaints properly. Ofgem revealed that 1,395 Ovo customers experienced significant delays in having their complaints resolved, with some waiting up to 18 months.

The regulator also noted that there were hold-ups in Ovo implementing the Energy Ombudsman's decisions when complaints escalated. In response, Ovo has agreed to pay £378,512 in compensation to those affected and has contributed an additional £2 million to the Energy Industry Voluntary Redress Scheme "in recognition of the severity of consumer detriment caused", as stated by Ofgem. Customers impacted by these issues will be contacted directly by Ovo, the regulator has confirmed.

Jacqui Gehrmann, Ofgem's deputy director of retail compliance, said: "Ovo failed to adequately protect and respond to their customers when it was needed most. This is not acceptable. Consumers deserve a clear and timely response when they make a complaint, and that's why we stepped in quickly when we identified that Ovo's performance was falling below acceptable standards."

Ofgem initially reached out to Ovo in June last year following concerns raised about the time it took to deal with complaints forwarded by Citizens Advice Scotland's Extra Help Unit, as well as to implement resolutions from the Energy Ombudsman. Since then, Ovo has improved its complaint handling processes, enhancing its complaints management system and ensuring senior staff oversee complaint resolution, reports Wales Online.

The Energy Ombudsman said: "Our role is to resolve disputes between consumers and energy suppliers, providing independent and impartial decisions that ensure fair outcomes. These decisions are legally binding and suppliers are required to implement them within 28 days.

"While the majority of resolutions are carried out on time, there are instances where consumers face unacceptable delays. It is reassuring to see that this investigation is now concluded, and that Ovo has reviewed and improved its systems and procedures."

A spokesperson for Ovo said: "We recognise that a particular group of our customers in 2023 waited longer than we'd like for a resolution and were overdue a response from us, so we've sent them a letter of apology and compensation to help."