Households to receive automatic compensation for energy-switching problems

12 June 2018
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By the end of this year, households will be paid automatic compensation if an energy switch goes wrong.

Customers will receive at least £30 for each switching problem they encounter in a bid to boost consumer protection and confidence in switching.

Problems covered by the compensation payouts include being mistakenly switched to another supplier, known as an ‘erroneous transfer’, or switches taking longer than 21 days to complete.

Automatic payouts could also be triggered by suppliers which are late in sending final bills or refunding credit balances to customers who are leaving.

Last year, 5.1 million electricity consumers and 4.1 million gas consumers switched supplier, the highest number for almost a decade.

But energy regulator Ofgem says many people are put off from switching because of worries something may go wrong.

Rob Salter-Church, interim executive director of consumers and markets at Ofgem, says: “While the vast majority of switches go smoothly, too many problems are still occurring. These can cause inconvenience and, in some cases, real worry and stress for those affected.

“Today’s proposals for automatic compensation will strengthen protection for consumers who switch, and should serve as an incentive for suppliers to get switches right first time.”

In February, Ofgem gave the green light to allow people to switch energy supplier by the next working day, which will take force by 2020. 

Richard Neudegg, head of regulation at price comparison website uSwitch, says: "With record switching rates and savings of up to £491 on offer, households are benefiting from the huge choice available in the UK energy market.

"The vast majority of switches go through without any issue. However, any moves which provide further reassurance and engage more consumers so that they can find better deals are a positive step forward for energy customers."

Comments

In reply to by anonymous_stub (not verified)

why did I get a final bill which was estimated and was more than the units used.

In reply to by anonymous_stub (not verified)

My problem is about having a final bill which is estimated demanding far more units than used.

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