Shell has come under fire for overcharging customers after overcharging 11,275 prepayment customer accounts on its default tariffs.
The energy giant is set to refund £106,000 to UK consumers, which will be issued automatically to overcharged accounts.
Shell will also pay £400,000 to Ofgem’s voluntary consumer redress fund and £30,970 in goodwill payments to households, representing a total payment of £536,970.
The situation was linked to operational errors with the implementation of its default tariffs, which overcharged customers between January 2019 and September 2022.
The fault was discovered by Shell in March 2022. Tariff updates were issued to prepayment metres to alter rates in response to price cap level changes, however not all metres were correctly updated to the revised rates.
As a result, over 11,000 customers paid above rates allowed under the price cap over the period.
Customers will be refunded an average amount of £9.40 by Shell due to the error.
Ofgem commented it would not be taking formal action against the energy company, as Shell self-reported the problem and resolved it “in a timely manner.”
“Ofgem expects suppliers to adhere to the terms of contracts they have with customers, particularly ensuring they pay no more than the level of the price cap,” said Ofgem director Neil Lawrence.
“Households across Britain are already struggling with rising energy bills and living costs. Overcharging by suppliers can cause additional and unnecessary stress and worry at what is already a very challenging time for consumers across the UK.”
“Ofgem is always prepared to work with suppliers who have failed to comply with their obligations, but who have self-reported and are determined to put things right, as Shell has done here. The contributions Shell has made to the redress fund will help to support vulnerable consumers with their energy bills.”
