British Gas Business To Pay £5.6m Penalty

Corporate customers are to be compensated for a series of failures that prevented them from getting cheaper energy bills.

Ofgem has fined the arm of British Gas which serves business customers for a series of failures including blocking firms from switching to other suppliers.

The energy regulator said British Gas Business would pay a penalty of £800,000 on top of £1.3m already paid to 1,200 customers who ended up paying higher bills because they were not notified when their contracts were due to expire.

A further £3.45m would go to an energy efficiency fund, Ofgem said.

The watchdog found customers were denied the opportunity to shop around for a better deal and instead either continued on the same terms or were rolled over onto more expensive standard tariff rates.

Its enforcement partner, Sarah Harrison, said: "The ability for consumers to switch easily and fairly is key to a well-functioning energy market.

"In these cases British Gas Business failed these consumers who were wrongly blocked from switching, many of them small businesses, and denied others the chance to switch to a better deal at the end of their contract.

“British Gas Business fully accepts its failings, has stopped the practices and corrected its processes to prevent this happening again.

"The company has taken responsibility for its actions and this package strikes a balance of penalty for the company and redress for affected consumers.”

Ofgem said British Gas Business cooperated fully throughout its inquiry, which began in 2012, and that was reflected in the level of the settlement package which would have been much higher had that not been the case.