Botched Refunds: Npower Customers at Wits’ End

When a customer finds a better energy deal that gives them more value for their money, they are free to make a switch provided that they follow the guidelines set by the industry regulator Ofgem.


What most consumers do not know is that they are entitled to compensation when their previous supplier fails to offer a timely refund after switching.


And when it comes to refunds – Npower has been one of the few suppliers consistently lacking in customer satisfaction. Several consumers shared their stories about the Npower’s questionable practices in giving refunds and even their complaints handling.


Here are a few of refund fails that victims have shared online.


Refund mess-ups


A customer with the username KatieDee from shared her confusing and frustrating experience with Npower.  The customer received a quarterly bill from the supplier showing her account being in credit by £113.  The same bill also informed KatieDee that Npower was reducing her direct debit to £75 instead of the usual £95 monthly.


The customer got in touch with Npower and told them that she wants to receive a £38 refund from her credit and leaving some money on the account to the amount of the reduced monthly direct debit.  The Npower representative acknowledge her request and also assured her in the same call that the existing £95 would be cancelled and that amount would not be taken from her bank account.


She was taken aback a few days later when an Npower direct debit of £95 was taken from her account.


Although she received a refund, the supplier failed to update her direct debit amount to the agreed £75 and the representative she spoke to gave her false information.

The customer was advised to request an indemnity charge through her bank Halifax. However, after a few weeks, Npower took another £95 from her bank account.


When the customer logged into her Npower account, she was shocked to find that there was another bill for her three-week energy usage, which was already at a shocking £156.


KatieDee couldn’t understand how the bill spiked in only a few weeks when she was already in credit and used energy wisely.


It turned out that the customer apparently fell into an £81 and was told that she will need to pay £120, instead of  the reduced £75, every month if she was to set up the direct debit again.


Npower’s messed up billing system has caused unnecessary stress to the customer, pushing her to consider switching suppliers.


Delayed refunds


Another case of a refund failure by Npower involved failing to provide a timely refund into a deceased customer’s estate.


An Npower customer  passed away and was supposed to receive a £911.52 refund  into his estate.  The refund was promised to the family within twenty-eight days of Npower generating the final bill. However, Npower failed to meet their own deadline and prompted the bereaved family to open a complaint with the Ombudsman.


After the Ombudsman’s investigation into the complaint raised, Npower was given another twenty-eight days to credit and additional £150 on the complainant’s account, on top of the £100 promised by Npower.


Npower wrote letters to the complainant saying that they are unable to credit the refund because of technical issues and this situation with Npower stalled the closure of the complainant’s late father’s estate and halted the distribution of final assets to the beneficiaries.


In the end, Npower had to compensate the family an additional £350 on top of what was initially due. This ‘goodwill gesture’ was the Npower’s way of apologising for the trouble the family had to go through.

Ofgem regulations


In 2019, Ofgem set out a new policy requiring suppliers to return any final credit within 10 working days to customers who have switched to another  energy supplier.   If they are unable to do so, the customer will be entitled to compensation.


A previous energy supplier will be ordered to pay £30 to the switching customer if they are not prompt in refunding the customer’s credit balance.  Previous suppliers have to send any credit balance due within ten days from the final bill or they would be ordered to compensate the consumer more.


Additionally, if a customer falls victim to an ‘erroneous switch’, they could claim up to £120 in compensation.


This decision by the energy regulator is a welcome help to about 200,000 consumers per year who switch to new suppliers but are unable to receive credit balances on time.


Consumer groups have also been demanding for automatic compensation for the delayed final bill of over six weeks, but Ofgem is yet to give the go-ahead on this request.