Ovo Energy to Pay £2.4m in Compensation for Handling Complaints Ineffectively
Energy regulator Ofgem has announced that Ovo Energy will be paying a total of £2.4 million in penalties and compensation for failing to handle customer complaints effectively. This decision comes after concerns were raised over the time taken to address complaints referred by Citizens Advice Scotland’s Extra Help Unit (EHU) and to act on decisions from the Energy Ombudsman (EO).
The penalty includes a payment of £378,512 in compensation to affected customers and an additional £2 million to the Energy Industry Voluntary Redress Scheme. Ofgem stated that this extra payment is in recognition of the severity of consumer detriment caused by Ovo’s failure to address complaints in a timely manner.
Affected customers will be contacted directly by Ovo, and they do not need to take any action to receive their compensation. Ovo, the fourth largest household energy supplier in the UK, has acknowledged the delays in addressing customer complaints and has sent letters of apology along with compensation to those impacted.
Improvements in Complaint Handling Processes
Following Ofgem’s intervention, Ovo Energy has made significant changes to its complaint handling processes. The energy company has increased its resources dedicated to handling complaints, enhanced its complaints management system, and improved its case management processes to ensure that senior staff are supervising complaints.
Jacqui Gehrmann, deputy director of retail compliance at Ofgem, emphasized the importance of timely responses to consumer complaints. She stated, “Energy is an essential service, and when things go wrong, it can cause consumers a lot of distress. Ovo failed to adequately protect and respond to their customers when it was needed most, which is not acceptable.”
Gehrmann added that Ofgem takes customer service and complaints resolution very seriously and will not hesitate to take swift and definitive action against energy companies that fail to comply with the rules. The regulator is committed to driving up standards for consumers and ensuring that energy companies meet acceptable standards of customer service.
Response from Consumer Advocates
Natasha Gilmour, at Citizens Advice Scotland, commended Ovo’s response to the investigation by Ofgem. She stated, “It is reassuring to see how Ovo has responded to the investigation by Ofgem, and we are satisfied that the new practices implemented are ensuring good and timely outcomes for our clients.” The Extra Help Unit managed by Citizens Advice Scotland provides assistance to vulnerable consumers facing difficulties with their energy suppliers.
The Energy Ombudsman, which resolves disputes between consumers and energy suppliers, also expressed satisfaction with the conclusion of the investigation. The Ombudsman highlighted the importance of suppliers implementing decisions within a specified timeframe to ensure fair outcomes for consumers.
Lessons Learned and Moving Forward
Ovo Energy has acknowledged the need for improvement in handling customer complaints and has taken steps to rectify the situation. The company is committed to providing the best possible experience for its customers and has moved up in the Citizen Advice energy supplier rankings for service.
While delays in addressing complaints are regrettable, Ovo’s efforts to address the issue and compensate affected customers demonstrate a commitment to improving customer satisfaction. The energy company has learned valuable lessons from this experience and is dedicated to ensuring that similar issues do not arise in the future.
The energy industry as a whole can also learn from this case and strive to enhance complaint handling processes to better serve customers. Ofgem’s intervention serves as a reminder to all energy companies that compliance with regulations and timely resolution of complaints are essential to maintaining consumer trust and satisfaction.
In conclusion, Ovo Energy’s agreement to pay £2.4 million in penalties and compensation for mishandling customer complaints underscores the importance of effective complaint resolution in the energy sector. By implementing improvements in complaint handling processes and compensating affected customers, Ovo has taken a step towards rebuilding trust and improving customer satisfaction.