UPDATE 1-Centrica's British Gas ordered to pay $9.4 million by regulator

Thu Apr 10, 2014 4:21am EDT

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LONDON, April 10 (Reuters) - Centrica's British Gas, the subject of an anti-trust investigation alongside Britain's other big utilities, will pay about 5.6 million pounds ($9.4 million) to remedy past errors which had blocked business customers from switching suppliers.

The country's big six suppliers - SSE, Scottish Power, Centrica, RWE npower, E.ON and EDF Energy - are under intense political scrutiny ahead of a national election next year because of soaring utility bills.

Britain last month ordered an anti-trust probe into energy suppliers after finding signs of tacit price coordination. Regulators said competition was now so weak and public trust so low that a full investigation was required.

Energy watchdog Ofgem said on Thursday that British Gas's business unit had blocked some customers from switching suppliers between 2007 and 2012.

Computer errors had stopped some businesses from switching, while the firm had not informed other customers that their tariff was about to expire, meaning they did not shop around for a new deal, it said.

Ofgem said British Gas would pay an 800,000 pound penalty plus repay 1.3 million pounds to affected business customers, and would also contribute 3.45 million pounds to an energy-efficiency fund.

"The ability for consumers to switch easily and fairly is key to a well-functioning energy market," Ofgem senior partner Sarah Harrison said in a statement.

Ofgem said that British Gas had co-operated fully in its investigation and had corrected its processes to prevent any repeat of the errors. The company's response was reflected in the level of the settlement package, which would otherwise have been higher, the regulator said.

Stephen Beynon, managing director of British Gas Business, said: "We're sorry these errors occurred and have worked swiftly to change our computer systems and processes."

($1 = 0.5971 British Pounds) (Reporting by Sarah Young; Editing by Pravin Char)

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