Money Wellness
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calendar icon16 Apr 2024

Scottish Power set to pay £1.5 million for overcharging customers

Scottish Power was charging customers above the price cap during the height of the energy crisis. The average amount Scottish Power overcharged customers was £149 per customer.

This affected 1,699 direct debit customers, who were charged a higher rate between 2015 and 2023 (11 price cap periods) which should only have applied to those who pay by standard credit, or on getting a bill.

Regulator Ofgem said the energy firm is paying a total of £250,000 in direct refunds to affected customers as well as another £250,000 in goodwill payments. This comes to an average of £294 per customer.

Ofgem said Scottish Power reported itself last summer, when it found that operational errors had led to the mistake.

Scottish Power has also agreed to pay £1 million to Ofgem’s Energy Industry Voluntary Redress Fund, which benefits charities and community projects that help vulnerable customers with energy-related support.

Dan Norton, Ofgem’s deputy director for price protection, said: “The last few years have been challenging enough for energy customers facing increasing cost-of-living pressures, without the additional hardship of being overcharged. The price cap is there to protect consumers, and we take seriously any breaches of the safeguards we have put in place.

“Suppliers must be vigilant and act quickly to resolve billing errors that impact customers. We will continue to closely monitor all suppliers and will hold them to account if they do not meet the standards we set.”

Scottish Power said it has put additional controls and monitoring in place to lower  the risk of anything similar happening in future.

I’m a Scottish Power customer, do I need to do anything?

No. All payments will be made automatically, and customers do not need to do anything.

Energy arrears

If you’ve fallen behind with your energy bills, the first thing you should do is get in touch with your supplier. Some offer grants to help customers who are really struggling or you may be able to agree a payment plan for the amount you owe.

If you're vulnerable, it’s also worth finding out if you can sign up to the priority services register. This is a free scheme that provides access to extra help from your energy supplier. Find out more about the priority services register

Read our guide on what to do about energy arrears.

Avatar of Lydia Bell-Jones

Lydia Bell-Jones

With a background in banking, Lydia has been writing professionally for over five years. She is passionate about helping people improve their personal finances and has a particular interest in the connection between money and mental health.

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