The energy supplier reported the technical error – which affected a small proportion (0.04%) of its total customer base between 2015 and 2023 – as soon as it was discovered last year.

It took immediate steps to correct the issue, which saw customers paying – on average – £149 more than they should have in the full eight-year period.

ScottishPower has also put additional controls and monitoring in place to reduce the risk of anything similar happening in future.

The agreed compensation package, which includes direct refunds as well as goodwill payments, means affected customers each received an average of £294.

All refunds and goodwill payments have been made and there is no need for customers to take any action.

ScottishPower will also pay £1 million to the Energy Industry Voluntary Redress Fund, which benefits charities and community projects that help vulnerable customers with energy-related support.

Andrew Ward, CEO of ScottishPower’s customer business, said: “We’re so sorry that a very small number of our customers were affected by this mistake and faced an increased financial burden – especially during a time when energy prices were reaching an unprecedented high and the government had to step in to provide support.

“Looking after our customers is at the heart of everything we do and our immediate notification to the regulator, swift corrective action and the compensation package agreed with Ofgem show both how seriously we take this matter and our commitment to making it right.”