THOUSANDS of customers could receive refunds after one of the region’s biggest energy suppliers was ordered to repay overcharged households.

Npower, which has more than 500,000 customers in the North-East and North Yorkshire, is repaying more than £74m to about 1.8 million customers in England.

Those affected will receive an average of £40 after the group, based in the North- East admitted confusingly changing its billing system in 2007, leaving many smaller gas customers out of pocket.

A spokesman for the company, which was fined nearly £2m last year over the misselling of contracts, said: “Although the vast majority of our customers benefited from the combined effect of the changes, some, who were low users of gas, did not.”

Energy regulator Ofgem launched an inquiry after customer complaints, resulting in the company having to repay £1.2m to 200,000 customers last year.

But the firm was forced to go back through millions more bills after a campaign by watchdog Consumer Focus, and has ended up having to pay the £63m plus VAT and interest.

The company plans to contact everyone affected over the next two months, even if they are no longer customers, offering payments that can be cashed at the Post Office.

A spokesman said: “We are sorry that the complexity of the changes we made caused confusion, We are now doing all we can to improve our communication with customers.”

Head of Consumer Focus Mike O’Connor said: “Consumers have been waiting a long time for this announcement and we are pleased with the final result.

“We have worked closely with npower to ensure that refunds are made fairly and that no customer loses out.

“A huge amount of work and collaboration has resulted in the right thing being done by npower for its customers and we welcome this."