Thousands of people have been charged more than double the correct amount on their gas bills because of basic errors in meter readings by energy companies, industry executives have admitted.
Firms failed to apply the correct conversion rate between cubic feet and cubic metres when new metric gas meters were installed, Ofgem found. The industry regulator said it had written to companies about the error.
Some consumers may have overpaid by 130 per cent while others could have underpaid by 60 per cent, industry experts told the Financial Times.
Big-six provider Eon said in a statement on Monday that 350 of its customers had been affected and would be refunded and compensated in full. About 250 customers have been undercharged and will not have to pay anything. Other firms have until Friday to identify customers who have been overcharged.
Energy UK, the industry body, said it was working with companies “to investigate and address a gas metering issue” which had potentially affected “an extremely small number of accounts”.
“Anyone who has been affected will be contacted directly and any incorrect billing or charging will be sorted out as quickly as possible, including any refunds where necessary,” it said.
An Ofgem spokesperson said: “Ofgem is working with suppliers to ensure consumers don’t lose out. This includes suppliers setting out plans to redress their affected customers, and to reach a quick resolution.”
The latest gaffe comes just weeks after the Competition and Markets Authority ruled that 70 per cent of big-six customers were each paying about £300 per year too much on expensive default variable tariffs. The CMA also found that vulnerable customers were overpaying on expensive prepayment meters and ordered firms to cap prices.
Profits have been hit by the tumbling price of wholesale power, as well as policy reversals, such as Britain cutting green subsidies. Hundreds of thousands of customers deserted British Gas in the first half of 2015, partly because it failed to pass on falling gas prices to its customers.
Last year Npower was ordered to pay a record £26m for billing problems affecting more than 500,000 customers.
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