Ofgem slaps Eon with provisional order in clampdown on poor service as it launches urgent British Gas probe

Ofgem has continued its clampdown on the energy sector, naming and shaming firms in a critical review of the energy market.

It has slapped Eon’s renewable energy arm with a provisional order, after it uncovered severe weaknesses in the service it provided to customers.

Eon Next Energy is a domestic supplier serving over two million households, with the watchdog finding fault over the firm’s extensive call waiting times and abandoned call rates.

It argued its performance represented a severe deterioration in standards from Ofgem’s previous audit of the supplier.

This was particularly egregious considering current market circumstances with rising costs to consumers, making it more likely that customers will need to contact their supplier for advice on billing, payment options and payment difficulties, energy efficiency advice and debt.

Eon Next Energy will now be expected to make improvements which Ofgem will closely monitor.

Neil Lawrence, Director of Retail at Ofgem, said: “From being on hold for too long, to not being given clear information, or sometimes not getting through to suppliers at all, this review has highlighted that customer service is just not good enough.

“In a world where customers need to be confident in consistently great care and support, it is clear that improvements need to be made.“

The supplier’s provisional order was imposed as part of its fourth market compliance review – its latest deep dive into energy supplier standards.

This latest review looked at customer service and complaints performance from information submitted by 17 of the biggest domestic energy suppliers.

Not a single supplier had minor or zero issues, with the review finding widespread problems such as inconsistent scripts for staff handling complex calls, customers left waiting for hours on the phone on several occasions, alongside phone calls simply not picked up with slow responses on written customer contacts.

Overall, Ofgem found moderate weaknesses at eleven suppliers – British Gas, E Gas & Electricity, EDF, Good Energy, Outfox the Market, OVO, ScottishPower, SO Energy, Utilita, Utility Warehouse and Tru Energy.

It discovered minor weaknesses at five other suppliers – Bulb, Ecotricity, Green Energy, Shell and Octopus.

Ofgem’s findings tally with what customer reviews of the energy industry.

How bad is it?

Early indications from a recent Energy Satisfaction survey of 3,000 domestic energy consumers show that in November-December 2022, overall customer satisfaction with energy suppliers was amongst the worst ever seen since tracking began in 2018.

This survey, funded by Citizens’ Advice and OfgeM and carried out by Quadrangle Research, found that a fifth of consumers who had fallen behind on paying their bills felt they did not receive appropriate support for their needs.

Alongside today’s market compliance review, Ofgem has also launched a separate urgent investigation into practices at British Gas and its treatment of vulnerable customers, which is outside the scope of the findings from this review.

This follows The Times’ investigation into third-party debt agents operating on behalf of British Gas owner Centrica – which found they routinely forced entry into homes to force the installation of prepayment meters.

City A.M. understands Ofgem is set to impose a temporary ban on new warrants for prepayment meters pending further investigation.

The watchdog met with suppliers today for crunch talks as continues its push to reform the industry.