Ofgem Threatens Action against Energy Suppliers
Ofgem, the energy watchdog, is warning energy suppliers that they may have to pay compensation to and cut prices for millions of customers who do not benefit from ‘duel fuel’ price plans or benefit from direct debit pricing discounts. Ofgem said that it may consider licence conditions if energy companies do not reduce costs for such consumers on a voluntary basis.
Some energy companies have come under fire for adding surcharges to the bills of customers who do not pay by direct debit, with consumers protesting about unfair pricing policies. Another practice being monitored is that of undercharging direct debit customers which leads to customer arrears and the requirement of the customer to stay with the present provider until the arrears are cleared.
One commentator stated: “Energy providers have often been criticised for charging their direct debit customers differently to those who choose to pay by other means. In many cases this has meant customers going into debt on their accounts, which they might have been able to avoid had they been on a direct debit plan.
“But not everyone likes paying by direct debit – some people prefer to pay by cheque or in cash, as they may feel this gives them greater control over their finances.
“Hopefully Ofgem’s words will prompt energy suppliers to amend their charging strategy, and we will see fewer customers struggling with debt because of their bills.”
