Raw Deal: Huntly couple were owed £700 after the collapse of Economy Energy

KENNY and Shirley Stewart are among thousands of people left out of pocket after the collapse of Economy Energy.

The gas and electricity supplier, which was recently banned from taking on new customers, ceased trading last week, leaving 235,000 energy users in limbo.

Customers had spoken of problems with disputed account balances, the firm’s failure to issue refunds, and concerns over billing delays. The Energy Ombudsman said it was looking into 1,303 complaints about the supplier.

The Stewarts, from Huntly, Aberdeenshire, have been caught up in the drama.

The couple switched to another power supplier in October after becoming fed up with the service from Economy Energy – but say they are still owed about £700 in overpayments.

“I have never received my money and they were still taking monthly payments from me,” said Kenny.

“I contacted Economy Energy umpteen times but I was told not to cancel my direct debit with the bank before I received my refund.

“They also told me when I contacted them in early December that they would stop the request for payments from me but they didn’t.”

The promising news for the Stewarts and other former customers of the firm is that the energy regulator Ofgem has vowed that refunds will be honoured.

It has now appointed Ovo Energy to take on the company’s domestic customers. They will be automatically moved over to Ovo Energy’s standard variable tariff.

Ofgem also says Ovo will honour all outstanding credit balances, including money owed to former Economy Energy customers.

If you’d left Economy Energy prior to it stopping trading and are owed credit, this will also be honoured, and you will be contacted directly about the refund by Ovo.

Ofgem’s Philippa Pickford said: “Ovo will offer Economy Energy’s customers a competitive tariff for their energy.

“Their credit balances will be honoured and their energy supply will continue as normal.”

Kenny said he was disappointed that he will still have to wait for his £700 but is “relieved there appears to be a solution to this”.

Ovo had already established itself as a so-called supplier of last resort, willing to take on customers of companies which were unable to keep trading.

Ovo said: “This is a good outcome for Economy Energy customers who have had an uncertain few weeks. We are pleased to welcome these customers to Ovo.”

Meanwhile, if you are a customer of a small energy firm it is advisable not to build up large credit balances.

Nine such suppliers have failed in the past 12 months, affecting more than 800,000 households.