Two major energy suppliers have been ordered to pay £4 million in compensation after they were found to have overcharged customers during the energy crisis.

Ovo Energy and Good Energy will pay compensation to around 18,000 households after energy regulator Ofgem discovered the error.

Ofgem said errors by the two suppliers meant some people were charged above the maximum rates allowed under either the energy price cap or the Government’s Energy Price Guarantee scheme.

The affected households will receive a combined total of £2.7 million from the two companies while an extra £1.25 million will go to vulnerable customers in the UK.

 

The average amount paid to Good Energy customers will be £109 while Ovo customers will receive an average of £181, Ofgem said.

Dan Norton, deputy director of retail at Ofgem, said: “It is totally unacceptable that Good Energy and Ovo Energy customers were overcharged, particularly at a time that is already so challenging and stressful for consumers across the UK.

“Energy suppliers should hear this loud and clear: we expect suppliers to act with the utmost care and integrity.

“We will continue to hold them to account if they do not meet their customer protection or reporting obligations.”

An OVO Energy spokesman told The Sun: "We’re very sorry to some of our fixed-price customers who experienced a delay in receiving the energy price guarantee discount.

"We noticed immediately and self-reported the error to Ofgem.

"The issue has now been fixed and compensation has been paid as an apology.

"We have also made a voluntary contribution to the redress fund to help support customers in vulnerable situations."

Nigel Pocklington, Good Energy CEO, said: “We are very sorry that we let some of our customers down and promise to put things right.

"We have been contacting those impacted to apologise and issue their refunds and goodwill payments and will be fixing the issue so it does not happen again.

“The issue, which we reported to Ofgem as soon as it was apparent, originated in 2019.

"It meant that customers who switched payment method to direct debit were not receiving their discount for doing so. 

“Every customer payment method change is now being checked and the formal improvement plan we have submitted to Ofgem includes new automated processes, standards and governance to prevent any similar mistake in future.”