Utilita to pay £277,000 for Warm Home Discount payment failures
Press release
- Publication date
- Company
- Utilita Energy Limited
- Industry sector
- Supply and Retail Market
- Scheme name
- WHD
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Energy company Utilita will pay around £277,000 in compensation after failing to pay its Warm Home Discount payments on time, following a review by Ofgem.
The regulator found that, in the scheme year covering 2023-2024, Utilita – which supplies 800,000 customers – failed to pass on the mandatory discount to more than 4,000 customers within the required timeframe because of an internal error in processing payments.
The Warm Home Discount scheme - which is administered by Ofgem on behalf of government - supports energy consumers on low incomes by offering an automatic payment of £150 to eligible customers each year.
In recognition of the impact delayed Warm Home Discount payments could have on its customers Utilita has agreed to pay £247,000 of compensation to those affected, who will receive further payments of up to £150 each. This is in addition to £30,000 of compensation Utilita paid to affected customers shortly after the error was identified.
Ofgem has also today published its Supplier Performance Report, which assesses supplier performance in the delivery of a number of government schemes including the Warm Home Discount and Feed-in Tariffs schemes.
The report confirms that in the same 2023-2024 scheme year, the regulator secured nearly £762,000 in redress payments from suppliers for non-compliance with the Warm Home Discount scheme. This includes direct compensation to customers and payments into Ofgem’s Voluntary Redress Fund which funds projects and schemes to support energy consumers, particularly those in vulnerable situations.
Cathryn Scott, Regulatory Director of Market Oversight and Enforcement at Ofgem, said:
“The Warm Home Discount is a lifeline for vulnerable energy consumers on low incomes. Even a short delay in making these payments can cause harm to vulnerable customers, so it's vital that suppliers make these payments on time and without hassle.
“Unfortunately, on this occasion, Utilita fell short of our standards by failing to pay some of their customers in a timely manner. Utilita has conducted an audit of their Warm Home Discount processes to make sure this doesn’t happen again.
“It’s our duty to protect consumers. And today’s outcome, as well as the findings set out in our Supplier Performance Report, serve as a reminder to all suppliers that failures to make scheme payments on time are unacceptable, and that we can and will take enforcement action to put things right for customers.”
Utilita is completing an independent review of their Warm Home Discount processes and Ofgem will continue to monitor all suppliers’ compliance with their obligations under the Warm Home Discount scheme.
Notes to editors
- All affected customers have been contacted by Utilita and don’t need to do anything. They will be compensated automatically.
- Utilita missed the 31 March 2024 deadline to make the Warm Home Discount payment to customers by 12 days due to an internal error. Utilita self-reported the error to Ofgem last year. A detailed investigation followed, and Utilita has now updated its systems to rectify the error.
- Last year, suppliers spent a combined £578.7million supporting low-income households through the Warm Home Discount.
- If suppliers fall short in their required payments, Ofgem works to ensure they correct their mistakes and requires assurances that the issues which led to their shortcomings have been resolved. If a supplier’s failings are more serious, the supplier is likely to face compliance or enforcement action.
- This relates to regulation 9 (5) and 10 (5) of the Warm Home Discount Regulations.
- The Warm Home Discount scheme supports energy consumers on low incomes and who are vulnerable to cold-related illness or living wholly or mainly in fuel poverty.
- View Ofgem’s Supplier Performance Report.
- In the Warm Home Discount scheme year 2023-2024, Ofgem agreed nearly £762,000 in redress payments from suppliers, including the £277,000 from Utilita, for non-compliance with the Warm Home Discount scheme.