Regulator fines second energy supplier over complaint handling

It is the second heavy fine levied on one of the “big six” energy firms over complaints handling in the space of four months following a £2.5m fine for British Gas in July.

Ofgem said npower failed to record all details of the complaints it received, did not give customers enough details of the redress service offered by the energy ombudsman and failed to put in adequate processes to deal with complaints.

The regulator said it is also currently investigating the way EDF Energy, another of the big six suppliers, handles its complaints.

Sarah Harrison, Ofgem’s senior partner for sustainable development, said: “Consumers have a right to expect that energy companies will comply with the standards.

“Npower failed to do so and, although it took remedial action, it has incurred a penalty for failing consumers.”

Ofgem added that the fine would have been higher had the company not admitted the breaches of regulations and taken action to improve its complaints procedures.

Npower, which is owned by German group RWE, is the UK’s fourth largest provider and supplies about 3.3 million customers.

This month it put up its average tariffs for gas by 15.7 per cent and electricity by 7.2 per cent because of rising wholesale power prices.

The firm was fined £1.8m in 2009 by Ofgem for mis-selling after complaints from customers about its doorstep sales team.

Shadow Energy Secretary and Don Valley MP Caroline Flint said: “For too long, energy companies have been able to do what they want at the expense of everyone else. The announcement shows clearer than ever why we need fundamental reform of the energy market to break the dominance of the big six and get a fairer deal for the people of Britain.”