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Shell Energy Retail Apologises After Being Pulled Up For Overcharging

Shell Energy Retail's top boss apologised to customers after Britain's energy regulator ordered the utility to compensate around 12,000 customers it overcharged on default tariffs after a price cap was introduced this year.

Ofgem said Shell Energy Retail Ltd, previously known as First Utility, will pay £200,000 ($253,520) in addition to the refund to its consumer redress fund, bringing the total payment to 390,000 pounds.

This is the first such action against a company for overcharging since the price cap on default energy bills came into force on 1 January.

The price cap was aimed at saving households about a billion pounds a year following a government promise to tackle what it had called 'rip-off' prices.

Shell Energy Retail overcharged a sum of £100,737 collectively above the level of the price cap between January and March this year, Ofgem's said.

Apology 

"We'd like to apologise to all customers who were temporarily out of pocket," Colin Crooks, Chief Executive Officer, Shell Energy Retail said in an e-mail to Reuters.

Crooks said the company had a small number of customers on fixed-price default tariffs to whom it didn't apply the capped rates since most of those customers would have been better off remaining on their existing tariff.

"However, we recognise that there were some who would have been better off on the capped rates or who suffered a delay in changing their payment method," he added.

Ofgem said it decided not to take formal enforcement action since the company addressed its failings.

News by Reuters, edited by Donna Ahern Checkout. Click subscribe to sign up for the Checkout print edition.

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