LONDON (Reuters) - OVO Energy has agreed to pay 9 million pounds to its clients after billing problems, in a voluntary move agreed with market regulator Ofgem just two weeks after it became the country’s second biggest supplier.
A relative newcomer to the market, OVO joined the ranks of Britain’s “Big Six” energy suppliers with a 500 million pound takeover of SSE Energy Services, the retail arm of OVO’s peer SSE (SSE.L), this month, expanding its client base to 5 million homes.
On Wednesday, Ofgem said its investigation showed that due to failings in OVO’s IT systems and compliance gaps, too many of its clients were billed in inaccurate or incomplete ways for over five years, resulting in overcharges for some.
“These breaches occurred while OVO did not put enough attention on ensuring its processes and governance were capable of complying with Ofgem’s rules,” Ofgem said in a statement.
OVO, despite being aware of these issues, did not self-report the majority of them back to the regulator, Ofgem said. The firm has corrected the breaches and had voluntarily agreed to pay 8.9 million pounds to help vulnerable customers.
OVO, founded by its Chief Executive Stephen Fitzpatrick a decade ago, accepted the findings and Ofgem said the company had put measures in place to make sure it did not happen again.
“OVO Energy holds itself to high standards, but we have not always got it right. We accept Ofgem’s findings of issues regarding estimation processes, information formatting and pricing errors,” the company said.
Japan’s Mitsubishi Corporation (8058.T) holds a 20% stake in OVO Energy.
Reporting by Katya Golubkova and Susanna Twidale; editing by David Evans