energy news

Npower has started to repay customers overcharged for their gas following a two-year battle. Are you due a refund?


1st November, 2010

Npower gas customers could be due a refund of up to £100

The majority of consumers who were supplied gas by Npower at any point between May and November 2007 are likely to be affected – about 1.8 million previous and existing customers. The amount of money customers will be entitled to will vary by tariff, gas consumption and when they became an Npower customer.

However, those who were on the following gas tariffs or payment types were not affected by the overpayments and will not be entitled to a refund:

• Gas pre-payment meter customers

• Customers who were on the Gas guardian tariff, the 2009 Price Fix tariff, the Tracker tariff, the 1st steps (social tariff), or the Sign Online 8 tariff

• Electricity customers (the issue was gas specific)

• Business gas customers

I am due a refund. What should I do?

You do not need to do anything to claim your compensation payment. Npower is writing to all current and previous customers affected by the end of November to offer payment. This will be in the form of a letter which can be exchanged for cash at any Post Office branch.

What then?

The letter begins: "Recently we've been discussing with Consumer Focus (the consumer watchdog) some changes we made in 2007 to the way we charged for gas and have taken the decision to send you a one-off payment relating to your gas charges at that time ... we've chosen to send you this one-off payment as a letter redeemable at the Post Office. We've taken the additional step of including VAT and a sum in lieu of interest in this payment."

It goes on to state that it will pay any tax liability due on the interest directly to HMRC so "you don't need to do anything" and "it will not affect your tax position in any way".

All you have to do is take the letter, along with two forms of ID, to the Post Office within six months to claim your compensation. The letter finishes with an apology: "We're sorry that our gas charging in 2007 wasn't as clear as it could have been".

Npower should also include a explanation of how it calculated your payment and why.

What if I haven't received a letter?

Consumer Focus urges anyone who thinks they may be entitled to a refund but have not heard from Npower by the end of November to call the Npower helpline on 0800 975 7938. It particularly urges previous Npower customers who have switched supplier and changed address to get in contact if they do not hear from the supplier (these customers may be harder for Npower to track down).

How much can I expect to receive?

Payments will range from £1 to £100. The average payment will be £35 plus interest and VAT on top. This is a combined £63m of refunds plus 5% VAT and 6.7% interest.

Is the level of payment accurate?

Npower has worked closely with Consumer Focus to review its customer accounts and calculate fair payments for individuals. The watchdog said: "We think these payments offer fair recompense for overpayments customers made."

However, if you still feel you have not been refunded adequately you should contact Npower's helpline on 0800 975 7938 in the first instance, and Consumer Direct on 08454 040506 for further advice if you remain dissatisfied.

Consumer Focus said that if you do dispute the payment, when you call Npower you should provide your name, the address at which you were supplied with gas by Npower in 2007, the period during which you were supplied, and where possible your Npower account number from that period.



<< back to news