Ovo Energy Faces £28 Million Compensation Payment for Delayed Support to Vulnerable Customers

Ovo Energy, one of the UK’s largest gas and electricity suppliers, has been ordered to pay £2.8 million in compensation for its failure to deliver essential state support payments to thousands of vulnerable customers. The company was found to be more than 19 months late in making warm home discount payments to approximately 11,000 bill payers.

The energy regulator, Ofgem, revealed that Ovo did not meet the statutory deadlines for the warm home discount scheme, leaving many customers in dire need without the assistance they were entitled to during the coldest winter months. Reports indicate that average energy bills soared to around £2,000 per year, compounding the distress faced by affected households.

Among those impacted, 7,726 customers were classified as vulnerable, with 4,066 identified as medically vulnerable. Ofgem noted that the delays in payment could have had severe consequences for those experiencing fuel poverty. The regulatory body expects energy suppliers to act promptly and reliably when fulfilling obligations to customers, particularly those with special needs.

Ovo has since apologised for its shortcomings, indicating that measures have been put in place to prevent future occurrences. The company has assured all affected customers that they will receive £150 in compensation, with an additional £150 for medically vulnerable individuals. Furthermore, those unable to top up their meters during the affected period will receive an extra £100 for each instance.

The government scheme aims to alleviate energy costs for low-income households by providing £150 off their electricity bills, with payments managed directly by energy suppliers. This situation raises concerns about the operational efficiencies within major energy companies, especially in light of increasing regulatory scrutiny.

Ovo’s financial stability has also come under the spotlight, as the company has previously warned of significant material uncertainty regarding its future. With a reported net loss of £135 million in its latest accounts—down from a profit of £817 million the previous year—Ovo acknowledges the need for comprehensive reforms to strengthen its financial resilience.