Ofgem guaranteed standards, compensation withheld - RESOLVED

masonic

Earlier this week I received a £40 credit to my Octopus Energy account for them failing to provide a final bill within six weeks of a switch. I am somewhat sympathetic to them as there is a fairly good chance some or all of the blame lies with my new supplier, Tomato Energy. However, them's the rules.

With no sign of a final bill materialising, I requested to access this compensation, but received the following reply:

"Unfortunately, the credit will be automatically applied to your account, and we cannot process a withdrawal directly to your bank account until the final bill is created."

This does not seem correct. The information on Ofgem's website suggests there is a 10 working day window in which they must compensate you if there is a breach. While it is not stated explicitly, I do not see how a customer can be considered compensated if the money is not made available to them. Crediting it to an energy account from which the customer is not allowed to withdraw it surely cannot meet the obligation.

The relevant legislation is a statutory instrument The Electricity and Gas (Standards of Performance) (Suppliers) Regulations 2015 (link, as amended 2024 to uplift compensation to £40). Regulation 8(7) states:

"(7) Where a customer requests that a payment actually or potentially due to be made to the customer under these Regulations is made by a particular payment method, the supplier must not unreasonably withhold agreement to make the payment to the customer by that method."

I've not been provided with any reasonable grounds for refusing to credit this payment to my bank account. I still have a valid variable direct debit in place, and this can be used to collect payment for my final bill if and when it is produced. My final bill will be under £3, since Octopus took a smart reading from my meter the day before my switch and have billed me up to that date already.

I am inclined to take the position that if this £40 compensation is not made available to me within 10 working days of the breach, I should claim a further £40 under regulation 8(3)(a).

Newbie_John

Let's see what happens - sounds like a grey area, I've received my credit 2-3 months ago and still nothing.. but I take a coffee every week and play on the wheel of fortune - treating it as interests.

bristolleedsfan

masonic said:

I am inclined to take the position that if this £40 compensation is not made available to me within 10 working days of the breach, I should claim a further £40 under regulation 8(3)(a).

I think suppliers have option of either automatically crediting energy account or bank account, put complaint in about them not refunding when requested to do so, ask for whatever amount of compensation you feel appropriate to resolve complaint.

masonic

Newbie_John said:

Let's see what happens - sounds like a grey area, I've received my credit 2-3 months ago and still nothing.. but I take a coffee every week and play on the wheel of fortune - treating it as interests.

You too eh? It just seems rather petty to withhold it, and if your experience is anything to go by, it could be for months. Allows them to report to Ofgem that they've compensated the customer promptly, but customer does not benefit from the compensation while the two suppliers fight it out.

QrizB

Perhaps Tomato's cunning plan to dominate the energy market involves bankrupting all the other suppliers with £40 payments to their former customers?

HillStreetBlues

Same issue as I'm having, £30 credit on bill that I'm yet to receive from Octopus. (switched beginning of Sep)

Chrysalis

At least you got the credit, they rushed my bill out incorrectly, its interesting how experience on Octopus is volatile. 
I assume you still with them for gas though, and its a shared balance, so maybe just let it pay for a future gas bill?
Seems its bad that there is a loophole, the rule really should a "valid bill" issued on time not "any bill".

masonic

Chrysalis said:

At least you got the credit, they rushed my bill out incorrectly, its interesting how experience on Octopus is volatile. 
I assume you still with them for gas though, and its a shared balance, so maybe just let it pay for a future gas bill?
Seems its bad that there is a loophole, the rule really should a "valid bill" issued on time not "any bill".

I don't have a gas supply so am no longer a customer.

The legislation states that the standard relates to your final bill, so that would be the last one they send you. If you receive a bill more than 6 weeks after leaving them, you should claim the compensation.

Anyway, I have asked them to look at this again in my case as I don't think they have a reasonable excuse to withhold the compensation.

Chrysalis

masonic said:

Chrysalis said:

At least you got the credit, they rushed my bill out incorrectly, its interesting how experience on Octopus is volatile. 
I assume you still with them for gas though, and its a shared balance, so maybe just let it pay for a future gas bill?
Seems its bad that there is a loophole, the rule really should a "valid bill" issued on time not "any bill".

I don't have a gas supply so am no longer a customer.

The legislation states that the standard relates to your final bill, so that would be the last one they send you. If you receive a bill more than 6 weeks after leaving them, you should claim the compensation.

Anyway, I have asked them to look at this again in my case as I don't think they have a reasonable excuse to withhold the compensation.

Fair enough, in which case I change my opinion, fight them for what is yours.  

masonic

After some fruitless back and forth with an Octopus AI chatbot, I had a look in my account and there is a new deduction of £2.17, backdated to 9th Jan. This is exactly correct for my final day's usage. I've not received the bill yet, but it looks promising. I only spotted it as something had eaten into my £40 compensation payment that I've been trying to get out.

masonic

masonic said:

After some fruitless back and forth with an Octopus AI chatbot, I had a look in my account and there is a new deduction of £2.17, backdated to 9th Jan. This is exactly correct for my final day's usage. I've not received the bill yet, but it looks promising. I only spotted it as something had eaten into my £40 compensation payment that I've been trying to get out.

Confirming my final bill has just dropped. Final reading was entered as "Customer reading". They confirm they will now pay out the remaining £37.83 of the compensation.