ScottishPower offers money back to customers

31 March 2009

ScottishPower has become the first major energy company in the UK to compensate direct debit customers who overpay for their gas and electricity.

Last week, a report from Ofgem criticised energy supplier for making it hard for customers to reclaim their money when they are in credit. The report followed claims from Which? that energy companies are using inflated direct debit payments as interest-free loans, with the average gas customer in credit by £84.

ScottishPower says that, from the start of June, it will automatically pay £1 back for every full £33 a customer is in credit at their annual direct debit reassessment date. This only applies to balances over £100 and up to a maximum of £500.

Willie MacDiarmid, director of energy retail at ScottishPower, says: “Direct debit instalments are calculated accurately at the start of each payment year, so ensuring customers only pay for the energy they use. Our credit reward scheme […] is an added bonus for those customers who prefer to remain in credit and avoid falling into debt.”

The move by ScottishPower might see other energy companies reassessing the way they treat direct debit customers, and potentially introduce their own ‘compensation’ schemes.

Martyn Hocking, editor of Which?, says: “Now that ScottishPower has announced that it plans to compensate customers that are in this position, we hope to see the rest of the ‘big six’ play fair with customers and follow its lead.”

ScottishPower has also announced a new option for its customers, which offers a 5% discount to people that pay at least one year’s estimated energy usage upfront.

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