Npower rues £70m refund
October 13, 2010 at 2:49 pm
On October 1st, a three-year row over gas tariffs finally ended, after dual-fuel provider, Npower, agreed to repay a share of £70 million to customers it had overcharged in the past.
The repayment, which could be shared between 1.8 million people, stands as reparations for a poorly communicated change in the way the supplier bills its subscribers for their gas supply, dating back to 2007.
Npower altered its gas tariff to charge customers a set amount of ‘primary block units’ per month, regardless of the time of year.
In previous years, customers might have paid less for their gas during the winter, when consumption is higher, but the new tariffs meant that everybody had to pay a fixed rate all year round.
Whilst the supplier claims that the “vast majority of customers” benefited from the overhaul, people who consumed relatively small amounts of gas were sent bills that charged them for units that they had not used. In some cases, Npower’s customers had up to £100 added to their gas bill.
However, the average refund is much closer to £35, with repayments from an identical sales probe in 2009 being deducted from the final sum.
Npower paid an average of £6 per affected customer during the first round of repayments but Consumer Focus, a self-proclaimed “consumer champion”, took umbrage with the sum, finding it simply inadequate.
The watchdog then badgered Npower for 20 months in order to persuade the energy firm to commit to repayments that would take into account how much money customers had actually lost, rather than sending out the same £6 cheque to every subscriber.
Speaking after Friday’s announcement, Npower’s Head of PR, Richard Frost, was apologetic, stating: “We are sorry that the complexity of the changes we made caused confusion. We are now doing all we can to improve our communication with customers”.
Npower claims that it will write to affected customers (both current and former) within the next two months and all refunds will be redeemable at the Post Office.
