Ofgem has closed a second case into SSE this month, having decided not to take formal action for the delay customers experienced when they switched tariffs.
SSE paid £190,000 in compensation to customers after it withdrew a “white label” partnership tariff with social enterprise, Ebico and failed to switch customers to another tariff within the required 49 days.
The energy supplier took almost six months to switch customers onto a new tariff, which saw some lose savings because of the delay. SSE said it took voluntary action to “put things right” for affected customers.
Ebico terminated its partnership with SSE at the end of 2016 and in February 2017 SSE withdrew the white label tariff from the market.
Ofgem said SSE failed to comply with its licence in part while it considered other options for customers.
Some customers who were switched ended up on a cheaper tariff, but lost money they would have saved due to the delayed switch. SSE paid £190,000 in compensation to these customers.
Other customers who were switched ended up paying more on the tariff. The energy supplier made a goodwill gesture payment of £475,000 to this group of customers.
SSE compensated all affected customers, set up a dedicated customer support team for customers who queried the compensation amount and a support fund for customers who required further compensation.
The regulator said: “Due to the steps SSE has taken in co-operating with Ofgem, contacting and compensating affected customers, Ofgem has not taken formal action against the supplier.”
Gareth Wood, director of customer service operations at SSE, added: “We’re disappointed not to have met the high standards expected of us in this instance, but took voluntary action to put things right and ensured any customers facing detriment were identified, contacted and compensated in full.
“In addition, we voluntarily decided to credit customers who had actually benefited from the delayed migration. We’re pleased that Ofgem is satisfied the matter has been resolved and has now closed the case.”
Ebico set up a new white label partnership with Robin Hood Energy in January 2017, which “initially set out” to switch customers without their consent.
Ebico wrote to all the customers of the SSE – Ebico white label tariff that they would be automatically transferred to a better deal with Robin Hood Energy.
Ofgem said: “This would have contravened the supply licence as customers need to give their consent to be switched to another supplier, as they remained customers of SSE.”
The regulator worked with Robin Hood Energy, to make the company aware of its licence obligations and responsibilities.
Subsequently, the supplier revised its approach and made customers aware of their option to switch.
It emerged earlier this month that SSE will pay £1 million to Ofgem’s consumer redress fund after the energy company sent 580,000 pre-payment customers “inaccurate and misleading” information in their annual statements between 2014/2015.
Ofgem highlighted SSE failed to “act promptly to put things right” but has now closed the case.