SHELL energy is to pay prepayment meter customers £106,000 after the firm overcharged thousands of customers.
The energy supplier is to pay 11,275 prepayment customer accounts it has overcharged on its default tariffs.
Shell Energy will also pay a further £400,000 out to its customers.
Refunds will be issued automatically to affected customers.
Those on prepayment meters will see the cash added as a credit on their meter.
The average amount being refunded to affected customers is £9.40.
In addition, the supplier will pay £400,000 to Ofgem’s voluntary consumer redress fund and £30,970 in goodwill payments to affected customers, equating to a total payment of £536,970.
The redress fund isn’t a compensation fund but one which provides money to charities, trusts, organisations and consumers.
In March 2022, Shell Energy discovered that the implementation of its default tariffs meant it had overcharged 11,275 prepayment customers for periods of time between January 2019 and September 2022.
When the price cap changes energy suppliers need to send updates to customer prepayment meters.
In this case, not all Shell supplied meters were updated to the revised rates – meaning thousands were overpaying on their gas and electricity.
The energy price cap currently sits at £1,977, but it is predicted to rise to £3,553 in October.
Those on prepayment meters already pay more, as the price cap for smart and traditional meters is set at £2,017.
Neil Lawrence, director of retail, Ofgem said “Households across Britain are already struggling with rising energy bills and living costs.
“Overcharging by suppliers can cause additional and unnecessary stress and worry at what is already a very challenging time for consumers across the UK.
“Ofgem is always prepared to work with suppliers who have failed to comply with their obligations, but who have self-reported and are determined to put things right, as Shell has done here.
“The contributions Shell has made to the redress fund will help to support vulnerable consumers with their energy bills.”
What energy support is available this winter?
All four and a half million prepayment meter customers are eligible for a £400 energy bills discount this winter.
The discount will be paid in six instalments from October. Two worth £66 and four worth £67.
Those on smart prepayment meters won’t need to do anything and the discount will be automatically credited to your meter each month.
However, those on older traditional prepayment meters won’t be able to receive the discount directly.
These customers will need to collect and redeem a discount voucher to take advantage of the £400 energy discount.
You should receive clearer instructions on how to use and redeem the full value of these vouchers once you get them in the post of via text.
There are plenty of energy grants and schemes open to help you out if you’re struggling. Ask your supplier what’s on offer and how to apply, or check here:
- Bulb energy fund
- EDF’s energy customer support fund
- E.on’s energy fund
- Npower’s energy fund
- Ovo’s debt and energy assistance
- Scottish Power’s hardship fund
There’s also a one-off fuel voucher from your energy supplier if you’re on a prepayment metre.
Thousands of households on benefits will also be eligible for the £150 Warm Home Discount.
Anyone getting the state pension will also get winter fuel payments worth £100s. These are a tax-free payment that comes from the government each year and is worth between £100 and £300.
Councils are offering residents cash support through the Household Support Fund and Discretionary Fund scheme.
Eligibility for the cash can differ from council to council. So you’ll need to check what your local authority is offering.
