Npower fined £2m for complaints failures

NPOWER has been handed a £2 million fine by the energy regulator after it failed to properly deal with customer complaints.

The penalty is the second in six months for one of the “Big Six” energy companies, after Scottish Gas owner British Gas was fined £2.5m in July for breach of the same regulations.

A third firm, EDF Energy, is currently under investigation by Ofgem over similar issues.

The regulator said Npower had not put in place adequate policies and processes for dealing with some complaints efficiently and quickly.

It also did not supply some customers with details about the service provide by the Energy Ombudsman if they were disatisfied with the way their complaint had been handled.

Npower admitted it had failed to adhere to a “small number of processes” and insisted it was committed to improving customer service.

“Consumers have a right to expect that energy companies will comply with the standards,” said Sarah Harrison, Ofgem’s senior partner for sustainable development. “Npower failed to do so and although it took remedial action, it has incurred a penalty for failing consumers.”

Consumer groups welcomed the fine – saying it demonstrated a tough stance on energy firms, which have recently come under fire for confusing pricing structures and for a lack of competition in the market. “It is encouraging to see Ofgem willing to hammer home the point that unless energy companies start treating consumers fairly, there will be a price to pay,” said Trisha McAuley, deputy director at Consumer Focus Scotland.

“Dealing with complaints properly is the foundation of good customer service. Things will go wrong, problems will need sorting out and customers will make complaints. How a company deals with those is the best indicator of how much they value their customers.”

Richard Lloyd – executive director at Which? – added: “Ofgem is absolutely right to penalise energy suppliers that aren’t dealing with complaints properly. People are fed up with bad customer service, and suppliers must work hard to win back trust.

“We all pay for the Energy Ombudsman through our bills, so the least we should expect is to be told about the service when we make a complaint.”

Ofgem said that the fine would have been higher had the company not taken action to improve its complaints procedures.

“For too long, energy companies have been able to do what they want at the expense of consumers in Scotland,” said Tom Greatrex MP, Labour’s shadow energy minister. He added: “Today’s 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 people.”

A spokesman for Npower said: “A small number of processes were not correctly adhered to. Ofgem is satisfied that all problems have been rectified and we are fully compliant with our obligations to our customers.

“We have zero tolerance for this type of issue and we’ll continue to work hard to make sure our customers are put first.”