Energy companies could pay out at least £30 to customers who suffer problems when switching gas and electricity supplier, if new plans get the go-ahead.
Customers would receive automatic compensation for each switching issue they experienced, energy regulator Ofgem said. Its proposals aim to increase consumers’ confidence in switching energy supplier.
Which? research found that 5% of people who have switched gas and electricity supplier found it difficult. Almost a quarter (23%) of those said the top reason was that it was slow.*
While you can’t prevent all supplier-switching issues, use our guide to switching energy supplier to set yourself up for a hassle-free switch.
When would you get energy compensation?
The compensation will cover problems such as being mistakenly switched to another energy supplier (‘erroneous switch’), or switches taking too long to complete. Specifically, the plans state you’ll get £30 or more compensation for reasons including:
- if your switch isn’t completed within 21 days of the start of your contract
- if suppliers don’t agree whether a switch is mistaken within 20 days of it being identified
- if you don’t receive a final bill within six weeks of switching
- if you aren’t refunded money you’re owed within two weeks of the final bill.
You wouldn’t have to apply for compensation; it would be paid to you automatically. It would come partly from your previous energy supplier and partly from your new one.
Ofgem said it plans to have automatic compensation in place by the end of the year. It’s currently consulting on its proposals.
*Which? energy-switching research
We conducted an online survey of 8,937 energy customers in September 2017.
After slowness, the next biggest reason for switching being difficult was getting a refund from the previous supplier.
Planning on switching? Make sure you get the best deal. Compare gas and electricity tariffs with our independent switching site, Which? Switch.
What Which? thinks
Alex Neill, Which? managing director of home products and services, said: ‘consumers find energy switching slow and difficult so introducing automatic compensation for when it goes wrong is welcome.
‘The regulator now needs to deliver on its proposals so that companies get it right first time and consumers are encouraged to switch given you can potentially save over £400 a year.’