Shell Energy will refund and compensate 11,275 prepayment customers after it was revealed that their accounts were overcharged.
The energy firm will refund approximately £106,000 while also handing out £30,970 in goodwill payments for all households affected. Shell admitted that thousands of its customers on default tariffs paid above the permitted rates under Ofgem's price cap due to some meters not being updated correctly.
Shell overcharged customers throughout the price cap window enforced by Ofgem between January 2019 and September 2022. Meanwhile, a new price is due to be enforced on October 1, the Mirror reports.
Shell reported itself to Ofgem and announced that the problem was caused by "operational issues". Customers will receive their refunds automatically and shouldn't have to apply to get the money back.
According to Shell, customers will get roughly £9.40 back in the form of a refund, with compensation added on top. The firm will also pay £400,000 to Ofgem's voluntary customer redress fund - the money will be handed out to charities, trusts, organisations and consumers.
Neil Lawrence, Director of Retail at Ofgem said “Ofgem expects suppliers to adhere to the terms of contracts they have with customers, particularly ensuring they pay no more than the level of the price cap. Households across Britain are already struggling with rising energy bills and living costs.
“Overcharging by suppliers can cause additional and unnecessary stress and worry at what is already a very challenging time for consumers across the UK. Ofgem is always prepared to work with suppliers who have failed to comply with their obligations, but who have self-reported and are determined to put things right, as Shell has done here.
“The contributions Shell has made to the redress fund will help to support vulnerable consumers with their energy bills.”
A Shell Energy spokesperson said: “We’re sincerely sorry that errors updating our prepayment meter rates resulted in some customers being overcharged for a period of time. As soon as we identified the issue we began taking steps to put it right, and self-reported it to Ofgem.
“The overcharge, which averages £9.40 per customer, will be refunded along with a gesture of goodwill. We will be writing to customers to let them know.”
Read next:
-
Brits urged to make simple five-minute home check to save thousands on energy bills
-
DWP warning to everyone who is eligible for a cost of living payment
-
Utility Warehouse customers can get this fixed tariff ahead of October energy price cap
-
Thousands of homeowners who paid doubled ground rent to receive refund
-
People urged to claim £150 grant 'as soon as possible' as deadline approaches
