Ofgem demands Big Six return £400m to customers

The regulator wants energy companies to give back money from closed accounts. Kinda tricky if people don't leave contact details...

by Rachel Savage
Last Updated: 18 Feb 2016

Ofgem is getting rather feisty at the moment. Earlier this week it was warning big energy companies to play fair with their tiny rivals or face fines, and now it has puffed out its chest and demanded they hand back more than £400m from closed accounts.

The regulator claimed the ‘Big Six’ - British Gas, SSE, npower, ScottishPower, EDF Energy and E.On – owe £202m from 3.5 million closed residential accounts (an average of £58 each) and £204m from 300,000 unused business accounts (around £680 each).

‘Ofgem’s analysis shows an unacceptably large amount of money being retained rather than returned to consumers,’ said the government body, going all third-person on itself.

The industry lobby group Energy UK pointed out an obvious flaw in its thinking – customers often move on without leaving contact details. ‘More commonly energy companies are owed many times more money by people who leave unpaid debts behind them,’ it added.

Ofgem, in its new-found shouty role, had a ready response: ‘use this money to benefit consumers more generally’.

While, firstly, the notion of benefitting energy customers as a whole is pretty fuzzy, surely the fair thing to do would be for the ‘Big Six’ to use the credit to offset money they’re owed by departed customers (as they’re probably doing already), especially if consumers can’t work out how to claim back the cash for themselves. Or to build some new power stations to keep the lights switched on…

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