Ofgem has ordered E.ON Next Energy to pay £5 million in compensation for poor standards of customer service.
The order, which has been announced following an investigation by the energy regulator throughout 2022, has been issued due to the electricity and gas supplier’s customer contact provision having struggled to cope with demand from October 2022 to December 2022.
According to Ofgem, “many customers were unable to speak to E.ON Next or were forced to wait on hold for 18 minutes on average. The data also showed an unacceptable call drop-off rate with 50% of customer calls failing to successfully contact the supplier”.
It is believed that around 500,000 customers had been affected.
Our investigation into supplier standards has delivered a £5 million boost to consumers.— Ofgem (@ofgem) June 14, 2023
E.ON Next Ltd is to pay £5 million in compensation for poor standards of customer service, uncovered by an Ofgem review of the market.
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As a result, Ofgem has issued an order requiring immediate improvements to the call response rate. E.ON Next has already started addressing the issues and worked constructively with the regulator to quickly deliver improvements.
The result of this saw call waiting times reduced to an average of less than five minutes and the dropped call rate fell to below 10%.
However, E.ON Next has agreed to pay £5 million in redress to automatically compensate customers that had been most directly affected, with customers receiving £8 each totalling £4 million. As well as this, £1 million will be paid into Ofgem’s Voluntary Redress Fund, which supports energy consumers in vulnerable situations.
“This shows Ofgem’s determination to stand up for the rights of consumers and drive up standards. The very least that a customer should expect of their supplier is for them to pick up the phone to them in a timely way. The levels of service that we discovered at E.ON Next during the period of review were unacceptable,” said Cathryn Scott, director for enforcement and emerging issues at Ofgem.
“As the energy regulator, our purpose is to protect energy consumers and this action serves as a reminder to all suppliers that they must ensure that their customers are able to contact them quickly and easily when they need to. This is particularly important during this time of volatile energy prices when many households are struggling with their bills.”
In other news, Current± reported last week that Ofgem has proposed a £9.78 million fine to SSE Generation due to a breach of its Generation Licence.
The fine is a result of the energy generator securing excessive payments from National Grid ESO during ‘transmission constraint’ – when the electricity transmission system is unable to transmit power to the location of demand due to congestion.
SSE’s 300W Foyers pumped storage power station situated next to Loch Mhor in the Scottish highlands was found to be the culprit and by settling the investigation early, SSE qualified for a discount compared to the £11.58 million it would otherwise have been required to pay.