Octopus Energy undercharges thousands by 99.9 percent

Thousands of Octopus Energy customers have been accidentally undercharged by 99.9 percent due to a technical error and they don’t even have to pay a penny back. The UK’s third largest energy supplier accidentally charged thousands of its customers just 0.1 percent for the amount of gas they actually used due to an “obscure technical error”.

Octopus Energy admitted in an email to the undercharged customers the “unintentional discount” was triggered by an issue caused by “reading factors” and “unit flags”. Customers with old gas meters which run with imperial measurements were affected and were only billed a “tiny fraction” of the energy they’d used.

However, the firm reassured the customers they don’t have to worry about getting slapped with a new bill to reflect the actual amount of gas used, despite the error. Instead, the company held its hands up and let customers know they won’t be chased.

Octopus Energy told customers in the email: “Don’t worry about the gas we’ve already billed you for: that was our mistake, and we have no intention of re-issuing your bills or trying to charge you for it.”

An Octopus Energy spokesperson told the i paper: “We spotted a system error affecting a very small group of customers with older gas meters which still used imperial measurements.

“The customers in question got a 99 percent discount on their gas usage for a short period of time over winter, which we have honoured up to their latest bill.

“Customers don’t need to worry, the error is now fixed and all those affected have already been contacted.”

This comes as energy bills are costing Britons around double the amount they were being charged in 2021. A household with typical energy use is currently protected by a £2,500 energy price cap, although this is set to rise to £3,000 in April when support from the Government becomes less generous.

Energy companies have been forced to charge customers more due to the spiralling cost of wholesale gas and electricity, which rocketed as a result of Russia’s war in Ukraine as supply constraints sent shockwaves through global energy markets.

Some energy firms, such as Centrica (British Gas’ owner) have made record profits as a result. Centrica made £3.3billion in operating profits in 2022, up from £948million in 2021.

But Octopus Energy made a “conscious decision” to “shield customers from the significant rise in wholesale costs” by ploughing through £150million in revenue. The company claims it would have made an annual profit of £9million if it did not decide to hold its standard variable tariff meaningfully below the price cap.

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The company claimed bills were £50 lower than the UK household average compared to the price it was allowed to charge under Ofgem rules at the time due to the decision.

Octopus Energy’s head of finance Stuart Jackson said: “We held our standard variable tariff meaningfully below the price cap through that period and effectively provided some shielding to customers against the rising wholesale cost.”

The move contributed to a £141million operating loss for the last financial year, to the end of April 2022. Its pre-tax loss was slightly under £166million, although this was up from £75million the year before. However, its revenue climbed to £4.2billion, twice the amount it earned the year before.

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