EDF Energy To Pay £3m Complaints Penalty

EDF Energy is the latest of the so-called "Big Six" suppliers to be slapped with a penalty for market failures.

The regulator Ofgem said it had agreed to pay £3m to benefit vulnerable customers after its investigation found that the company breached complaint handling rules.

The inquiry was prompted by an increase of more than 30% in the levels of complaints recorded by EDF as it introduced a new IT system in 2011.

Ofgem found that between May 2011 and January 2012, EDF did not have appropriate procedures in place to properly receive, record and process all customers' complaints in accordance with handling rules.

Its technical problems included unacceptably high call waiting times, with many customers deciding to hang up before getting through to a customer services operator.

The company acknowledged its customers were caused significant disruption - and has apologised.

Sarah Harrison, Ofgem's senior partner with responsibility for enforcement, said of EDF: "Their commitment to putting things right and paying £3m to the Citizens Advice 'Energy Best Deal Extra' scheme and the Plymouth Citizen Advice Bureau's Debt Helpline to benefit vulnerable customers is a step in the right direction to rebuilding consumer trust.

"It's now vital for EDF Energy and the industry as a whole to truly put customers first and put adequate resources in place to deal with complaints.

"Following our reforms, it has never been easier for consumers to switch supplier and therefore those unhappy with the service they receive are able to vote with their feet."

Beatrice Bigois, EDF's managing director of customers, said: "Despite our best efforts and extensive planning to manage this transition in 2011 without impacting our customers, we recognise that for a period of time the service to our customers was not up to the standards they deserve.

"We apologise to those customers who were impacted during this period.

"We have co-operated fully with Ofgem and have taken this matter very seriously.

"The £3m package that we are offering will ensure that thousands of vulnerable customers are provided with free, independent advice on debt, as well as information to help them manage their energy consumption and bills."

The penalty against EDF followed similar actions by the regulator which saw SSE and E.ON pay the biggest sums for past failures as a debate rages on whether consumers get a good deal from the wider market.

The Big Six firms, which also include British Gas, Scottish Power and nPower, denied accusations of profiteering after collective profits quadrupled to more than £1bn over three years.

In a bid to rebuild trust the Competition and Markets Authority (CMA) is carrying out a full investigation, which will include an examination of the relationship between the supply businesses and generation arms of the Big Six.

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