OVO Energy, one of the largest energy providers in the UK, has been ordered to pay £2.37 million in compensation following severe shortcomings in handling customer complaints. The decision, made by energy regulator Ofgem, includes direct payments to affected customers as well as contributions to a redress fund.
Compensation Breakdown
According to Ofgem, OVO Energy will pay £378,512 directly to customers who experienced delays in their complaints being addressed. The regulator identified that up to 1,395 individuals faced significant delays, with some waiting as long as 18 months for resolution.
In addition to direct payments, OVO has contributed £2 million to an industry redress scheme. This fund supports energy customers and invests in energy projects, reflecting the severity of the consumer detriment experienced.
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Regulatory Criticism
Ofgem’s deputy director of retail compliance, Jacqui Gehrmann, criticized OVO for its inadequate response to customer issues. “It failed to adequately protect and respond to their customers when it was needed most,” Gehrmann stated. “This is not acceptable.” The regulator’s action underscores the importance of timely and effective complaint resolution in the energy sector.
Improvements and Changes
Since the onset of the investigation in June, OVO has made several improvements to its complaints handling process. These enhancements include allocating more resources and instituting changes to ensure that senior staff have oversight of customer complaints.
Concerns were also raised about delays in addressing complaints referred by Citizens Advice Scotland and in acting on decisions from the Energy Ombudsman. The improvements are aimed at addressing these issues and preventing future delays.
Company Response
In response to the compensation decision, an OVO spokesperson acknowledged the issues but highlighted recent progress. “We’re now third in the Citizen Advice energy supplier rankings for service,” the spokesperson said. “However, we recognize 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.”
