Investigation into npower’s compliance with Standards of Conduct (Standard Licence Condition 25C), Standard Licence Condition 27 (provision of final bills), and the Gas and Electricity (Consumer Complaints Handling Standards) Regulations 2008

Opened:
Jun 2014
Decision Proposed:
Dec 2015
Closed:
Jan 2016
Company:
npower
Regulation Area:
Sectoral Regulations

The Gas and Electricity Markets Authority (“the Authority”) has confirmed its decision to impose a financial penalty on npower Direct Ltd, npower Ltd, npower Northern Ltd, npower Northern Supply Ltd, npower Yorkshire Supply Ltd, npower Yorkshire Ltd and npower Gas Ltd. The Authority found that they failed to comply with Standard Licence Conditions 25C (Standards of Conduct) and 27.17 of the Electricity and Gas Supply Licences, and Regulations 3(2); 4(6)(a)-(d); 5(1); 6(1); 7(1)(a)-(b); and 10(2) of the Gas and Electricity (Consumer Complaint Handling Standards) Regulations 2008.

  • SLC25C (Standards of Conduct) requires suppliers to take all reasonable steps to achieve the Standards of Conduct and to ensure that the Standards are interpreted and applied consistently with the Customer Objective which is to treat customers fairly.

  • SLC 27.17 requires suppliers to take all reasonable steps to issue a final bill or statement of account within 6 weeks of termination of supply

  • CHR 3(2) requires suppliers to adhere to their own complaints handling procedure

  • CHR 4(6)(a)-(d) covers the recording and treatment of repeat/unresolved complaints

  • CHR 5(1) requires suppliers to record the handling of complaints

  • CHR(6)(1) requires suppliers to signpost the redress scheme of the Ombudsman after 56 days

  • CHR 7(1)(a) concerns the requirement of timely and efficient receipt, handling and processing of complaints

  • CHR 7(1)(b) requires suppliers to allocate and maintain resources reasonably required for timely, efficient and compliant complaints processing

  • CHR 10(2) requires suppliers to signpost their complaints procedure and offer to provide a copy to customers free of charge

The Authority considered it appropriate to impose a financial penalty for these contraventions. The Authority decided to impose a financial penalty of £1 on each of the seven npower companies (total penalty £7). This is in addition to £26m (less £7) that the npower companies agreed to pay in consumer redress. The redress will go to customers directly affected by the npower companies’ failings, and to charitable organisations for the benefit of domestic energy consumers. This redress must be paid to customers by the 30 June 2016 and to charitable organisations by 31 July 2016.

Furthermore, the npower companies agreed to meet targets on billing and complaints handling by 30 June 2016. If they fail to achieve these targets, the npower companies will stop all proactive domestic selling until they do so. 

Further details can be found in the final penalty notice.