Utilita to pay £277k compensation for Warm Home Discount payment failures | Personal Finance | Finance

Energy supplier Utilita will pay around £277,000 in compensation after failing to deliver Warm Home Discount payments on time, according to Ofgem. The regulator found that Utilita, which serves 800,000 customers, did not provide the mandatory discount to over 4,000 customers during the 2023/2024 period due to an internal payment processing error.

The Warm Home Discount scheme, administered by Ofgem on behalf of the Government, provides eligible low-income households with an automatic annual payment of £150 to help with energy costs. Ofgem said Utilita has agreed to pay £247,000 in compensation to those affected, with individual payments potentially reaching up to £150 each. This is in addition to £30,000 in compensation that Utilita paid to customers shortly after the issue was identified.

Cathryn Scott, regulatory director of market oversight and enforcement at Ofgem, said: “The Warm Home Discount is a lifeline for vulnerable energy consumers on low incomes.

“Even a short delay in making these payments can cause harm to vulnerable customers, so it’s vital that suppliers make these payments on time and without hassle.

“Unfortunately, on this occasion, Utilita fell short of our standards by failing to pay some of their customers in a timely manner. Utilita has conducted an audit of their Warm Home Discount processes to make sure this doesn’t happen again.”

Ms Scott added: “It’s our duty to protect consumers. Today’s outcome, as well as the findings set out in our Supplier Performance Report, serve as a reminder to all suppliers that failures to make scheme payments on time are unacceptable, and that we can and will take enforcement action to put things right for customers.”

A Utilita spokesman said: “Due to an administrative oversight, we missed the March 31 deadline to process the Warm Home Discount payment for a small cohort of customers. All customers received their payment within 12 days.

“We sincerely apologise for any inconvenience this may have caused. We promptly reported our mistake to Ofgem and paid the impacted customers a goodwill gesture.”

If you believe you have been affected by this error, you shouldn’t have to do anything to receive the compensation. 

Richard Neudegg, director of regulation at comparison site Uswitch.com, said that it is “disappointing that 4,000 households didn’t get the discount on time.”

He added: “It’s right energy companies are held accountable when things go wrong and they take steps to put it right, which is happening in this case.”

However, he noted: “While cash towards their winter bills helps vulnerable customers when they need it most, the focus over the long term must be on bringing down the cost of energy for households.

“Anyone struggling to pay their bills should contact their supplier, who can point them towards the help they need.”