The UK government is to publish plans to give regulator Ofgem new powers to force energy companies to compensate customers for mis-selling and overcharging.
Currently, energy suppliers voluntarily give cash to consumers following errors – but there is no obligation – while Ofgem has been able to fine companies, but that money has gone to the government.
Energy Secretary Ed Davey said he wants to bring Ofgem in line with other regulators such as Ofcom and the Financial Services Authority, who can ensure compensation goes to customers.
The redress could include pound-for-pound compensation, goodwill payments or public apologies.
“I want to make sure that consumers are protected and that the independent energy regulator has the powers it needs,” he said. “The government has already strengthened Ofgem’s hand by making it harder for energy companies to block licence changes, and introduced tougher rules on the information suppliers have to provide to their customers.