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Utility Warehouse (TEP.L) to pay £1.5m after customer failings probe

11:30, 10 November 2021

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A man leaning over a pile of energy bills to calculate the cost
Utility Warehouse, which provides customers with home services, including gas, electricity, broadband, mobile and home insurance, has been ordered to pay £1.5m to – Photo: Shutterstock.

Home service supplier Utility Warehouse, the trading name of Telecom Plus Plc (TEP.L), has agreed to pay £1.5m (€1.7m, $2m) to the UK’s energy regulator, the Office of Gas and Electricity Markets (Ofgem).

The company will pay Ofgem’s voluntary redress fund after it accepted that it had failed to consistently treat and advise customers fairly, which resulted in some being disadvantaged and facing increased financial hardship.

Ofgem said in a press release on Tuesday that it was made aware of Utility Warehouse’s failings following an audit report in 2018. A formal investigation was then opened which found that the company’s failings took place between 2013 and 2019.

Ofgem findings 

Ofgem found that the supplier ​​did not consistently offer to put domestic customers struggling to pay their energy bills on debt repayment plans, which would have allowed payments to be taken direct from customers’ benefits, or to take into account customers’ ability to pay when calculating the regular instalments as required. 

Moreover, it said that Utility Warehouse customers were not consistently offered the option of paying back charges via the voluntary installation of a pre-payment meter or offered energy-efficiency advice on how to reduce their bills. In some cases, this led to the unnecessary installation of pre-payment meters under warrant. 

Said Ofgem: “During the course of the investigation, Utility Warehouse also raised the fact that it submitted some inaccurate Social Obligation Reporting (SOR) data to Ofgem between 2013–2019.

“This data allows Ofgem to review suppliers’ performance regarding their social obligations and compliance with licence requirements, challenge poor performance and inform policy decisions.”

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The regulator has now closed the investigation and Utility Warehouse has offered to pay £1.5m into the voluntary redress fund, which supports vulnerable customers and innovation within the energy sector.

Supplier obligations

Cathryn Scott, director of enforcement and emerging issues at Ofgem, commented on the probe: “Energy suppliers are required to look after their customers, especially those in vulnerable situations.

“Between 2013–2019, Utility Warehouse failed to take the necessary steps to treat some customers in payment difficulty fairly, depriving them of the opportunity to manage their energy debt and ongoing energy costs.

“While the unprecedented and unexpected rise in gas and electricity prices over recent months has put energy markets under severe strain, we expect suppliers to continue to comply with their licence obligations and treat people fairly, including by providing support to vulnerable consumers.”

She added: “Where we see poor behaviour, Ofgem will be ready to step in and take swift action.” 

Read more: TSMC and Sony to invest bn for new chip plant in Japan

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