British Gas was the only non-compliant supplier during the latest year of the Warm Home Discount (WHD) scheme, Ofgem’s annual report has revealed.
The regulator said it did not take enforcement action against the retailer after it addressed the issues and agreed to pay out £160,000 into the industry’s voluntary redress fund.
A total of 25 suppliers were obligated at the start scheme year 10 which ran from 1 April 2020 to 31 March 2021, with four having exited the market before the year ended. More than £350.7 million of eligible support was provided, including £140 rebates to 2.26 million vulnerable customers.
Despite the issue of non-compliance, all suppliers, including British Gas, met their individual obligations.
Although Bulb, Octopus, Utility Warehouse and Symbio were each responsible for minor contraventions, they were not deemed substantial enough to affect overall compliance. As such, British Gas is listed as the only obligated supplier to be non-compliant.
The report explained that more than 42,000 of British Gas’ pre-payment meter (PPM) core group customers – low-income pensioners – were affected by an IT issue.
This resulted in some customers who had previously been provided with a £140 rebate having it mistakenly removed, while others were mistakenly overpaid after being provided with a duplicate rebate.
Although British Gas resolved all the cases by 31 December 2021, Ofgem said it was a “concern” that there was a significant number of vulnerable customers who did not benefit from their £140 rebate by the statutory year end (31 March 2021).
As such it was determined that, in addition to the £160,000 voluntary redress fund payment, British Gas should provide either a £20 reduction to affected customers’ debt balances, or where there is no debt balance on the account, apply a £20 credit.
In reclaiming the additional rebate from customers who were paid twice, the supplier agreed with Ofgem to limit the rate of reclaim to £3.65 per week so as to limit the burden on those who may have already spent the rebate on energy.
The total reclaimed would also only be £120, rather than £140, with the difference being left for the customer as a goodwill gesture.
Additionally, the company will submit a root cause analysis to the regulator detailing how the incident occurred, including changes in practice, management controls or governance to prevent reoccurrence.
Utility Week contacted Centrica for comment but none was received at the time of publication.