Utility Warehouse is set to undergo an investigation from the energy regulator regarding how it handles the customers who are in debt.
The company bundles phone, broadband services, and energy into one bill. It is promoted by Joanna Lumley, the Ab Fab star, on its website.
Ofgem said in a statement that it would be scrutinising at whether the supplier breached the industry code in the manner that it manages customers who are indebted.
The investigation will concentrate on the whether Utility Warehouse has proposed “appropriate repayment options” to its indebted customers, and whether they are not using warrants properly to force the installation of pre-pay meters to recover debts.
The regulator stated: “This includes whether it does enough to try and contact customers in or at risk of debt and to establish with them manageable repayment plans based on their ability to pay, as Ofgem’s rules require.”
It added: “It also includes whether they are installing pre-payment meters appropriately as a means of recovering debt from customers, particularly when they install them under warrant.”
Ofgem, however, did clarify that the launch of the investigation did not suggest that there had been a non-compliance by Utility Warehouse.
As a response, Utility Warehouse said that it was “surprised and disappointed” that Ofgem had decided to open a formal investigation into some of the processes of the company.
A spokesperson from Utility Warehouse stated: “An independent audit of these processes late in 2017 gave an overall positive report with a number of best practice recommendations now having been fully implemented.”
He added: “We will, of course, work alongside Ofgem to ensure that this investigation is concluded.”
However, the said investigation is expected to heighten the concerns over the surge of new energy market entrants who are hoping to challenge the Big Six suppliers.
This week, Utility Warehouse is already the fourth upstart energy company to face regulatory scrutiny. It was revealed that the energy minnows of the market have been pushed to the brink of collapse by the heightening financial pressure within the increasingly competitive market.