British Gas News Updates: OFGEM Exposes British Gas

British Gas News Update: This article has been sourced from The Telegraph: OFGEM, the regulatory body for gas and electricity, has exposed British Gas for overcharging their customers. After a faulty disclosure of the calorific value in the gas they have been supplying, British Gas admit there may have been negative interpretations.

Ofgem said British Gas had paid £10m into a trust for vulnerable customers to settle a fierce row over pricing. The donation is almost level with the record £10.5m fine Scottish & Southern Energy paid in April for “prolonged and extensive” mis-selling on the doorsteps of homes across the country.


British Gas was expected to announce its “donation” at the end of last week but it only came to light when sources contacted The Daily Telegraph on Monday morning.


The regulator claimed that between 2006 and 2011, British Gas failed to “round down” the calorific value, a charge that covers the heat or thermal energy in the gas a customer uses.


British Gas, the UK’s biggest supplier, used four decimal points, when Ofgem asks companies to use just one.

An Ofgem spokesman said: “British Gas’ interpretation of the regulations meant that although customers didn’t pay for energy they did not receive, they paid more than regulations allow.”

Ofgem admitted the total impact on customers was “unclear”. A spokesman admitted British Gas may have adjusted the main, unit price of gas and electricity to compensate for the higher charge on calorific value but it was impossible to say.

British Gas last insisted it had done nothing wrong and none of its customers had missed out.

Asked why it was paying £10m, a spokesman said the company simply wanted to resolve the row and move on, given the growing legal fees.

In a statement, British Gas said: “We are making this donation following clarification from Ofgem that, while we believe we were operating in line with the regulations, we accept there was an alternative interpretation.”

Ofgem is expected to announce another shake-up to the market this week with proposals for simplifying the tariffs the “Big Six” can offer households.

A YouGov this weekend claimed 38pc of the public trust energy companies less than a year ago. Just 3pc trust them more.

Some 76pc of people want the Government to crack down on the energy sector.

After scandal in the oil markets in which big name firms were price fixing, UK residents now have right to ask for a government enquiry into other industries. It has become apparent that British Gas may have been overcharging its customers for up to 5 years.


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