Automatic energy switching compensation: media statement

The energy regulator has today (Wednesday 12 February 2020) announced that customers will receive an automatic £30 payment from energy suppliers if they experience delays or mistakes when switching.

The energy regulator has today (Wednesday 12 February 2020) announced that customers will receive an automatic £30 payment from energy suppliers if they experience delays or mistakes when switching.

Ofgem says the new requirements, which take effect on 1 May, will give customers further peace of mind that they will be compensated if something goes wrong when they switch.

Under the new rules, customers whose switch does not complete within 15 working days, or who are switched by a supplier by mistake, will receive the payment from the new supplier. The supplier the customer is switching away from must pay out if it fails to issue a final bill within six weeks of a switch.

Ofgem introduced the first batch of compensation payments last year, meaning suppliers must pay out if they fail to meet minimum standards around spotting and correcting mistaken switches, or refunding credit balances to customers.

Read the announcement in full on the Ofgem website.

David Pilling, head of policy and public affairs at Trust Alliance Group, which runs the Energy Ombudsman scheme, welcomed the changes.

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“Switching is now second only to billing as a source of complaints that we handle, so it’s clear that for too many people the process of changing supplier doesn’t go as smoothly as it should.

“The introduction of automatic compensation is a welcome intervention by the regulator. It offers consumers access to immediate redress and gives suppliers a financial incentive to get switches right first time.

“At the same time we think it’s vital that, as well as paying compensation, energy suppliers look at what went wrong with the switch and make improvements to their processes. It’s in this root-cause analysis and pro-active work to raise standards across the sector that we see our role as the ombudsman.

“Anyone with an unresolved energy switching complaint – including about the payment of automatic compensation – can escalate the matter to us and we’ll investigate for free.”

David Pilling, head of policy and public affairs at Trust Alliance Group