The popular energy challenger Bulb has been ordered to pay £1.76million to customers after it overcharged thousands and blocked switches.
The supplier – which has taken a lot of business from the Big Six energy firms in recent years – was told by Ofgem to pay out after it found around 61,000 customers were affected by three separate failures between 2017 and 2020.
The energy watchdog revealed that Bulb overcharged some households, blocked consumers from switching and had issues with the Priority Services Register for vulnerable customers.
It said Bulb has since made changes to improve its processes and has paid a £1.76million package of redress, refunds and goodwill payments to those affected.
Energy firm, Bulb, has been ordered to pay £1.76m to customers after overcharging thousands
Most of the payment is made up of compensation and refunds as well as a £157,350 payment into the energy industry voluntary redress fund to support vulnerable customers.
Jonathan Brearley, Ofgem chief executive, said: ‘Bulb overcharged some customers and risked leaving vulnerable customers without access to essential network services, when it failed to comply with Ofgem’s rules.
‘Our rules are designed to protect consumers, and suppliers must make sure they have the processes in place to comply with them if they are going to give their customers good service.
‘Bulb has since put things right with affected customers and put processes in place to make sure it can meet Ofgem’s rules.’
The regulator also found that around 3,800 consumers on Restricted Meter Infrastructure (RMI), where there is more than one meter at a property, were prevented from switching to Bulb as the firm failed to submit the correct numbers of meters to their existing suppliers.
The challenger supplier, which is one of the main rivals to the Big Six, has since paid £155,500 to consumers affected by this.
Around 11,400 RMI customers were also overcharged £699,000 after wrongly having to pay multiple standing charges.
They have since been refunded and received goodwill payments on top, totalling £675,000.
A large number of customers were also blocked from switching by Bulb in a further error
In a further failure by Bulb, Ofgem said about 46,500 vulnerable customers were removed from their network operators’ Priority Service Register between March 2019 and January 2020 due to a data error.
This meant some of these customers missed out on essential priority services, such as being given advance notice of a planned power outage.
Ofgem said Bulb self-reported this issue in February and has paid £70,000 to the 933 customers who were removed from the register and suffered a power outage.
Bulb said in a post on its website: ‘We pride ourselves on the quality of our systems and technology, but in these instances we needed to improve.
‘To do so, we’ve strengthened the relevant teams, introduced new processes and training and introduced more checking and verification. We’re sorry. We will do better.’
Bulb has around 1.7million customers and last year began expanding into France, Spain and Texas.
Richard Neudegg, head of regulation at Uswitch, said: ‘Bulb has been a positive growth story in the energy industry in recent years, with many of its customers reporting high levels of satisfaction.
‘It is positive to see that Bulb has rectified the situation and since improved its processes, paying a £1.76million package of redress, refunds and goodwill payments.
‘However, consumers do expect all suppliers to get the basics right – and the system failures leading to overcharging of 11,400 customers an average of £61 will cause concern for some households.
‘A smaller number of Bulb’s customers were also blocked from switching – and have missed out on crucial savings.
‘Too many families under financial pressure are still paying over the odds for their energy, and switching suppliers is a great way to save money, so it’s important this is a service they can have access to.
‘Any customers who think they may have also been affected by similar issues and haven’t yet had the situation resolved should complain to their supplier directly.’
Bulb launched in 2015 and is best known for offering just one tariff made up of 100 per cent renewable electricity.
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