250,000 energy customers to get refund after Ofgem found an error in provider system

E.On Next is to pay out £14.5million to thousands of customers on a pre-payment meter.

Affected customers are set to receive an average of £144 each in compensation and redress payments.

The investigation revealed that customers who switched suppliers or ended their contracts did not receive mandatory final bills within the required six-week period.

Over 100,000 customers were left unaware of credit balances averaging £51 in their accounts and did not receive automatic refunds.

E.ON Next also failed to provide compensation payments of between £30 and £60 under the Supplier Guaranteed Standards of Performance rules.

The company has additionally agreed to write off debt held by almost 150,000 prepayment meter customers with closed accounts.

The £14.5million compensation package includes £4.7million in credit refunds to affected customers.

A further £6.6million will be paid out in compensation payments under the Supplier Guaranteed Standards of Performance scheme.

An additional £3.2million has been allocated for extra compensation to impacted customers.

For customers who cannot be traced, E.ON Next has agreed to make payments to the Energy Industry Voluntary Redress Fund.

Beth Martin, director for consumer protection and competition at Ofgem, said: "Prepayment meter customers are more likely to face financial difficulties, and during a period where households have been facing a significant cost of living crisis, it's unacceptable that consumers did not receive refunds for credit that was owed to them, or final bills they are entitled to."

She praised E.ON Next for self-reporting the issue and working to resolve it.

"The action to write off debt will also offer affected households' peace of mind," she added.

Chris Norbury, chief executive of E.ON UK, expressed deep regret over the system issue. He said: "We are deeply sorry to the customers affected by this system issue and have taken the correct steps to put things right."

He explained that the company acted swiftly upon discovering the error, implementing significant changes to prevent future occurrences.

Norbury confirmed that E.ON has "contacted all those affected directly" to ensure they receive outstanding bills, refunds and compensation, including debt removal for applicable customers.

This news comes as E.ON Next recently announced a £60million winter support scheme to help vulnerable customers.

The initiative is part of a larger £92million support package aimed at assisting customers with their energy bills.

More than 60,000 financially vulnerable customers have been identified as eligible for the winter scheme, which includes direct credit to accounts and potential debt write-offs.

Initial support includes £250 towards winter energy bills, with additional assistance tailored to individual circumstances