British Gas are being forced to pay £2.65 million in compensation and refunds to customers that were mislead about switching costs.
What did British Gas do wrong?
In essence, they gave people the wrong information about exit fees for their energy tariffs. Incorrect terms and conditions regarding charges for the end of their fixed deal led to thousands being overcharged, and millions more misled.
The T&C’s led people to believe that exit fees were payable during the 49 day period before their fixed deal expired, something that is not just slightly off, but completely false. By license conditions, customers are entitled to switch at any time during or after the specified “switching window”, without having to pay any kind of exit fees.
The specifics are a little bit complicated, but as the director of conduct and enforcement at Ofgem, said: “British Gas failed its customers who were coming to the end of their fixed contracts and switched supplier by unfairly penalising them and applying charges in error. Many more customers could have been deterred from getting a better deal due to the incorrect terms and conditions.”
How many people did it affect?
Ofgem, the body that regulates our energy companies in the UK, is reporting that 2.5 million customers were given the wrong information.
1,698 fixed-deal customers were incorrectly charged a total of £63,968 for changing energy supplier during the switching window.
A further 94,211 customers were overcharged by £782,450 due to a system error, which wrongly transferred them to a more expensive tariff (friendly reminder that standard tariff is almost always an awful deal).
What are they doing to fix it?
They’re paying out.
Before the investigation had even finished, British Gas paid out over half a million in refunds to customers that had lost out by over £1, with a further quarter million paid out after the investigation was concluded. They’ve also paid out over £1 million to Ofgem themselves, which went directly to the consumer redress fund.
Can I get a refund?
British Gas have been pretty swift in rectifying this error, and if they know you’ve been affected then they should be in touch.
If you think that you were affected by the misinformation and HAVE NOT been contacted yet, then we’d recommend going straight to British Gas directly. You can their account enquiries line on 0333 202 9802.