Npower fined £2m by energy regulator for poor customer service

Npower became the second "big six" energy provider to be fined for poor customer service this year, as Ofgem imposed a £2m penalty on the gas and electricity supplier.

An investigation by the regulator found that Npower, which is owned by Germany's RWE and supplies 3.3 million UK households, failed to record complaints properly. Furthermore, Npower gave those customers dissatisfied with its handling of their complaint insufficient details about the energy ombudsman's redress service, Ofgem found. It also found fault with the punctuality and efficiency of complaint handling.

The fine followed a £2.5m levy on British Gas in July, for breaching the minimum standards set out to deal with domestic and small-business complaints, while Ofgem is also investigating the way in which EDF Energy handles complaints.

Sarah Harrison, Ofgem's senior partner for sustainable development, said: "Customers 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 customers."

Adam Scorer, of Consumer Focus, said: "It is welcome to see Ofgem willing to hammer home the point that unless energy companies start treating consumers fairly, there will be a price to pay."

He added: "Customers need to be confident that suppliers will deal with their complaint quickly and fairly and that there will be consequences when they don't play fair."

Npower said: "We are very sorry, we let our high standards slip on this occasion. A small number of processes were not correctly adhered to. We have zero tolerance for this type of issue and we'll continue to work hard to make sure our customers are put first."

The big six dominate Britain's energy market, generating about 80 per cent of the total electricity and gas consumed and supplying 99 per cent of households. They are SSE, Scottish Power, E.ON, Centrica-owned British Gas, EDF and Npower.

They have come under fire in recent months after increasing their prices at a time when consumers are already struggling to meet their household bills. The big six argue that their costs have soared in the past year on the back of a 40 per cent rise in wholesale gas prices over the period.