Ovo, which is set to become the UK’s second-largest energy company, has been forced to pay £8.9m by regulators after it overcharged customers.
The firm, which bought SSE’s retail business last year, sent inaccurate statements to more than half a million customers.
Meanwhile, some of its customers did not receive a bill at all, the energy watchdog Ofgem said.
The firm agreed a settlement package with Ofgem to dodge a fine.
The money will be paid to vulnerable customers rather than the Treasury.
Despite knowing about the issues, Ovo did not tell Ofgem.
“Ovo Energy billed a number of its customers incorrectly and issued them with inaccurate information,” said Anthony Pygram, head of enforcement at Ofgem.
“The supplier did not prioritise putting these issues right whilst its business was expanding.”
In a statement, the energy company said “Ovo Energy holds itself to high standards, but we have not always got it right.”
Ovo – which was created 10 years ago – is already the UK’s largest independent energy supplier, with 1.5 million customers and about 2,000 employees.
But after buying SSE it has taken on another 3.5 million customers and 8,000 staff, making it second only to British Gas.