Npower fined £2m over poor complaints handling

It is the second heavy fine levied on one of the big six energy firms over complaints handling in the space of four months, following a £2.5 million fine for British Gas in July.

Ofgem says Npower failed to record all details of complaints received, did not give customers enough details of the redress service offered by the energy ombudsman and failed to put in adequate processes to deal with complaints.

The regulator says it is also investigating the way EDF Energy, another of the big six suppliers, handles its complaints.

Sarah Harrison, Ofgem's senior partner for sustainable development, says: "Consumers have a right to expect that energy companies will comply with the standards. Npower failed to do so and, although it took remedial action, it has incurred a penalty for failing consumers."

Npower was fined £1.8 million in 2009 by Ofgem for mis-selling after complaints from customers about its doorstep sales team.

Adam Scorer, director of external affairs at consumer rights group Consumer Focus, says: "It is welcome to see Ofgem willing to hammer home the point that unless energy companies start treating consumers fairly there will be a price to pay.

"This is the second of the big six to be fined this year for problems with handling customer complaints, and another is under investigation.

"Customers need to be confident that suppliers will deal with their complaint quickly and fairly and that there will be consequences when they don't play fair.

"Consumer Focus is particularly concerned that energy companies seem to avoid directing customers to the energy ombudsman. The ombudsman is the essential backstop if a company cannot or will not sort out someone's problem."

When energy firms are fined, the cash goes to the Treasury.