Ovo to Pay Over £10 Million After Ofgem Finds Vulnerable Customers Exposed to Risk

Ovo Energy has agreed to a settlement worth more than £10 million after UK energy regulator Ofgem concluded that weaknesses in the supplier’s handling of vulnerable prepayment meter customers created a risk that some households could miss out on essential protections. The action is one of the latest enforcement measures in Ofgem’s wider effort to strengthen standards across the energy sector and ensure suppliers are identifying and supporting customers who may be at greater risk.

The investigation focused on Ovo’s internal monitoring processes rather than the forced installation of prepayment meters. Ofgem said the supplier did not consistently record customer interactions, monitor warning signs or carry out key checks designed to identify vulnerability. While the regulator did not find evidence of widespread customer harm, it said the failures exposed some consumers to a “clear risk of harm” because important safeguards were not always applied.

Prepayment meters are widely used across Britain and allow households to pay for energy in advance. While many customers prefer the arrangement because it helps them manage spending, regulators have repeatedly stressed that extra care is needed when customers have health conditions, financial difficulties or other circumstances that could make energy access more challenging. In such cases, suppliers are expected to maintain accurate records and respond quickly when signs of vulnerability emerge.

Under the settlement, Ovo will contribute £7 million to Ofgem’s voluntary redress fund, which finances projects that support energy consumers across the UK. The supplier will also provide £3.4 million in credit payments and debt relief to some of its most vulnerable customers. Ofgem said the package was designed to directly benefit those most affected by the shortcomings identified during the investigation.

Many of the issues involved customers listed on the Priority Services Register, a system that helps suppliers identify households requiring additional support. The register includes elderly customers, people with disabilities, individuals with serious health conditions and those who rely on electrically powered medical equipment. Energy suppliers are expected to use this information to ensure vulnerable households receive appropriate assistance and protection.

Ofgem also highlighted concerns about Ovo’s staff training materials. Investigators found instances where guidance was unclear, inconsistent or contradictory. Effective training is considered a key part of customer protection because frontline staff are often responsible for recognising signs that a household may be struggling and needs additional support.

Beyond the prepayment meter findings, Ovo has agreed to pay a further £1.1 million to customers in the Scottish Highlands and Islands after Ofgem found the company failed to provide adequate engineer support to some rural households between January 2022 and April 2024. The regulator concluded that service levels in those areas fell below expected standards.

The latest settlement adds to a challenging period for the company. Earlier this year, Ofgem ordered Ovo to pay £2.77 million after nearly 12,000 customers experienced delays in receiving Warm Home Discount support. Among those affected were thousands of customers on the Priority Services Register, including more than 4,000 medically vulnerable individuals.

The regulatory action comes at a notable moment for the business. E.ON recently agreed to acquire Ovo in a deal that could reshape the competitive landscape of the UK energy market. The transaction is expected to create Britain’s largest electricity supplier and increase scrutiny of operational standards across the enlarged group. The significance of the takeover has attracted industry attention since E.ON’s £600 million acquisition of Ovo Energy was announced.

Ovo’s case is also part of a broader regulatory crackdown on prepayment meter practices. British Gas recently agreed to a £20 million payment package following a separate investigation into prepayment meter installations. While the circumstances were different, both cases demonstrate Ofgem’s determination to strengthen consumer protections throughout the energy sector.

In response, Ovo acknowledged that some historic processes failed to meet expected standards and apologised to affected customers. The company said it has strengthened policies, systems and customer support procedures, including new measures designed to better identify and assist vulnerable households. According to Ofgem, suppliers must ensure that vulnerable customers receive appropriate protections and that monitoring systems are robust enough to prevent risks from being overlooked.

For the wider industry, the settlement sends a clear message. As regulators continue to focus on consumer welfare, energy suppliers will face increasing pressure to demonstrate that customer protection is embedded in every stage of their operations, particularly when dealing with households that may be most at risk.

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