British Gas to pay £5.6m fine for blocking businesses switching

British Gas certainly knows how to rile up its customers. Britain’s largest energy supplier has been fined £5.6m in compensation and fines for preventing businesses from switching suppliers.

The news comes less than two weeks after its owner Centrica threatened blackouts if a competition investigation into the energy sector went ahead.

Energy regulator Ofgem said that British Gas had also failed to tell some businesses that their contracts were ending.

The company has already paid £1.3m to affected customers, Ofgem said, and will pay a further £3.45m into an energy efficiency fund. It will also pay an £800,000 penalty.

The payouts come after two investigations by Ofgem, the first of which, in 2012 found that a computer error at British Gas meant that 5.6% of objections it made to customers wishing to switch suppliers were “invalid”. The second investigation found that 1,200 small businesses had not been notified that their contracts with the energy supplier were about to end.

Ofgem did note that British Gas were quick to rectify the situation, and this was reflected in the size of the penalty they had to pay, the Guardian reports.

Ofgem’s senior partner in charge of enforcement 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.”

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