UTILITA Energy has been forced to pay £500,000 for overcharging pre-payment customers.
After an investigation by Ofgem, the regulator found that the energy firm overcharged almost 40,000 customers by over £125,000.
Utilita Energy has been forced to pay £500,000 for overcharging pre-payment customers
Around 6,600 prepayment customers were overcharged by around £22,700 above the prepayment price cap.
While 33,000 customers were overcharged a collective £105,000 above the amount they should have paid under their advertised tariff, but below the prepayment cap.
Suppliers can’t charge prepayment meter customers more than the level of the cap, which ensures they pay a fair price for their energy.
The price cap for pre-payment customers is currently set at £1,070 a year.
Utilita has already refunded all affected customers in full, and agreed to pay £500,000 in compensation.
Under the compensation package, Utilita will make a £10 goodwill payment to all existing customers who were overcharged.
If a customer is on the Priority Service Register, this payment increases to £15.
Utility will also make a £140 payment to the 900 customers affected who applied for the Warm Home Discount but were unsuccessful.
Utilita first self-reported to Ofgem that it had mistakenly overcharged its customers between May 2019 and September 2019.
After opening an investigation, Ofgem then found the firm had actually overcharged some customers between July 2018 and September 2019.
Cathryn Scott, Ofgem director of enforcement and emerging issues, said: “Ofgem closely monitors suppliers’ compliance with the price cap, which ensures consumers pay a fair price for their energy.
“This case sends a message to all suppliers that Ofgem will intervene if they charge customers above the level of the cap or above advertised tariffs.
“It also shows that, where appropriate, Ofgem is prepared to work with suppliers who have failed to comply with their obligations, but who have self-reported and are willing put things right quickly.”
HOAR has contacted Utilita for comment.
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