OFGEM SSE compensates customers £190,000 (7960S)
June 28 2018 - 2:00AM
UK Regulatory
TIDMSSE
RNS Number : 7960S
OFGEM
28 June 2018
SSE compensates customers GBP190,000 due to delayed switch
-- SSE has paid GBP190,000 in compensation to customers after
withdrawing a 'white label' partnership tariff with Ebico
-- SSE took almost 6 months to switch customers onto a new
tariff, with some losing savings because of the delayed switch
-- A new 'white label' partnership between Robin Hood Energy and
Ebico also initially set out to switch these customers without
their consent.
SSE has paid GBP190,000 in compensation to customers over
failures following its withdrawal of a 'white label' partnership
tariff with Ebico, the social enterprise.
At the end of 2016 Ebico terminated its partnership with SSE. In
February 2017, SSE withdrew the white label tariff with Ebico from
the market.
Suppliers have 49 days to move customers onto another tariff
when a tariff is withdrawn from the market. SSE took almost six
months, failing to comply with its licence, in part while it
considered other options for their customers.(1)
Some customers who were switched ended up on a cheaper tariff,
but lost money they would have saved due to the delayed switch. SSE
paid GBP190,000 to these customers to compensate for this
delay.
Other customers who were switched ended up paying more on the
tariff. SSE made a goodwill gesture payment of GBP475,000 to this
group of customers.
SSE compensated all affected customers, set up a dedicated
customer support team for those querying the compensation value and
a support fund for customers requiring further compensation.
Due to the steps SSE has taken in co-operating with Ofgem,
contacting and compensating affected customers, Ofgem has not taken
formal action against the supplier.
Following the termination of the partnership with SSE, in
January 2017 Ebico and Robin Hood Energy, the local authority-owned
energy company, entered into a new 'white label' partnership.
Ebico wrote to all the customers of the SSE - Ebico 'white
label' tariff that they would be automatically transferred to a
better deal with Robin Hood Energy. This would have contravened the
supply licence as customers need to give their consent to be
switched to another supplier, as they remained customers of
SSE.(2)
Ofgem worked with Robin Hood Energy, to make them aware of their
licence obligations and responsibilities to allow consumers to make
an informed choice. Subsequently, the supplier revised its approach
and made customers of the SSE - Ebico 'white label' aware of their
option to switch.
Notes to editors
1. Supply Licence Condition 22D (SLC 22D), states that when
suppliers remove a tariff from the market, they must migrate
customers onto fixed term or evergreen tariffs within 49 days.
2. Supply License Conditions 22 and 25 states that customers
need to give their consent to be switched to another licenced
supplier.
3. Ofgem has published its decision to close this compliance case.
Further information
For media, contact:
Michelle Amos: 0207 901 1881
Media out of hours mobile: 07766 511470 (media calls only)
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END
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