EDF to hand over £3.5m to vulnerable customers
EDF agrees to compensate customers after Ofgem finds that the energy company made misleading claims on the doorstep and at call centres.
Ofgem found that staff failed to provide complete information during the sales process, while those in call centres made claims about savings before knowing the specific details of each customers statement.
These were deemed to be breaches of EDF’s marketing licence and the energy company has agreed to set aside £3.5m for a £50 refund to around 70,000 customers who receive their warm homes discount. It will also make a £1m donation to an energy awareness campaign run by Citizens Advice.
Ofgem said customers would be better served through this type of direct payment than through the imposition of a fine. It said that by accepting some shortcomings in its sales practices EDF had escaped a bigger penalty.
Other companies are being investigated, with the regulator saying it is looking at sales practices at Scottish Power, SSe and npower.
Sarah Harrison, Ofgem’s senior partner in charge of enforcement, said: “In the energy market in general much more needs to be done to restore consumer confidence and all energy suppliers should now get behind Ofgem’s reforms to introduce a simpler, clearer and more competitive energy market.”
EDF’s managing director of energy sourcing and customer supply Martin Lawrence said: “We’re obviously disappointed that we failed to live up to the high standards that we expect of ourselves. As soon as the issue was identified we immediately took action to satisfy ourselves.”