E.On, one of the UK's biggest energy firms, has agreed with Ofgem to pay a penalty of £7.75 million for overcharging its customers.
Ofgem says that the penalty reflects repeated failures to adhere to billing rules and late disclosure of price changes.
Customers were charged higher exit fees upon price hike announcements and some customers paid too much for their energy while in the process of switching providers.
The level of penalty package also reflects that E.On made the same error in the past and made senior-level commitments that it rectified its processes. It was also taken into account that E.On notified Ofgem of the billing issues and cooperated throughout the investigation.
Sarah Harrison, senior partner in charge of enforcement said: 'Ofgem's rules give customers a chance to avoid exit fees and higher costs when suppliers put up prices. These are important customer protections and it is vital that suppliers play by the rules so customers are encouraged to engage in the market.
'E.On's errors meant customers who took the chance to switch were wrongly charged. It is important that E.ON has repaid potentially affected customers and cooperated with the investigation. However it's absolutely unacceptable that E.ON failed to provide these vital customer protections yet again and this persistent failure is the reason for the high penalty.'
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