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OFGEM

Decision to close the investigation into Utilita and its compliance with its obligations under the gas and electricity supply licences, Standard Licence Condition SLC 28A (pre-payment charge restriction)

Ofgem has decided to close its investigation into Utilita’s compliance with SLC 28A (pre-payment charge restriction) of its gas and electricity supply licenses and resolve the matter by way of alternative action.

The decision was taken in accordance with our Enforcement Guidelines and as a consequence of Utilita’s actions to identify customers affected and refund any overcharges; to make improvements to its processes; and, in recognition of its shortcomings, to offer to make redress payments to customers affected and to the Energy Saving Trust Voluntary Redress Fund.

SLC 28A relates to the pre-payment charge restriction, more commonly known as the PPM price cap.  Due to an administrative error, Utilita charged some of its customers above levels permitted by the cap.

During the course of the investigation, it was discovered that Utilita had charged some customers more than they should have paid under their tariff, but within the PPM price cap.  This issue was not covered by the scope of the investigation, as opened, but was addressed by Utilita as part of the Alternative Action taken.  Utilita has since issued refunds/credits to customers and offered a package of redress in recognition of these failings.

Having acknowledged these failings, Utilita has offered a package of redress totalling no less than £500,000 and this has been agreed.  This comprises of:

  • £10 goodwill payments to all existing overcharged customers  (increased to £15 if the customer is on the Priority Services Register);
  • A £140 payment to the c. 900 existing impacted customers who had applied for the Warm Home Discount (WHD) but were unsuccessful;
  • An additional payment of c. £45,000 to be paid into the Voluntary Redress Fund.

Further details can be found in the decision document.