Fuel giant to repay millions as mis-selling penalty

The regulator said that, between October 2009 and January 2012, ScottishPower provided customers with inaccurate estimations of annual charges and comparisons with their current supplier if they switched to the firm and failed to adequately monitor its sales staff.

ScottishPower has set up a £1m compensation fund for those affected, while the remaining £7.5m will be paid to more than 140,000 vulnerable customers, who will automatically receive payments of around £50 each by December.

ScottishPower will write to 336,000 households that may have been affected.

Ofgem said that, despite the failures, it found no evidence that ScottishPower deliberately set out to mis-sell.

ScottishPower apologised “unreservedly” to those affected and said it had taken steps to address its failures.

The group stopped doorstep selling in June 2011 and has overhauled training and monitoring procedures for all telesales staff.

Neil Clitheroe, ScottishPower’s chief executive of energy retail and generation, said: “We accept Ofgem’s findings and we apologise unreservedly to those customers affected.

“This arose as a result of new regulations which were introduced in 2009. I am sorry to say that we didn’t implement these properly at that time.”

The probe into ScottishPower comes as part of a wider market inquiry into mis-selling across the energy industry, which has already seen three investigations concluded.

SSE was fined £10.5m in April for “prolonged and extensive’’ sales practice failures. Ofgem is still conducting mis-selling investigations into npower and E.ON.