Fast-growing electricity and gas supplier Independent Energy has been forced to stop taking on new domestic customers after billing problems led to its call centre being overwhelmed.
The freeze, ordered by electricity regulator Ofgem, wiped more than £180m from Independent's stock market valuation
The company had been attracting 4,000 new domestic and small business customers a week before Ofgem called a halt.
Electricity regulator Callum McCarthy said, "By its own admission the company has faced significant problems during the past few months with setting up accounts and billing many of its customers."
John Sulley, chief executive of Independent Energy, said, "Our discussions with Ofgem follow the significant backlog in billing the group has experienced. We have been active in trying to resolve these and to date over 60% of the backlog has been cleared."
In February, Independent reported glitches that meant it had only billed for £35m of the £130m worth of electricity it sold in the second half of 1999. (Computer Weekly, 24 February).
The company was forced to bring in outside consultant X-Team, which is part of the Compaq group, to build software tools and temporary fixes to a bespoke billing system built by Vertex, a United Utilities subsidiary.
In February Sulley said he hoped this action would clear the backlog by the end of April. However, this week he said, "We anticipate substantially completing the backlog by the end of June."
As Independent Energy began to clear the backlog, its customer call centre, also run by Vertex, was overwhelmed by enquiries. "We could have responded more quickly, but that has been corrected," Sulley told Computer Weekly.
Independent Energy's outsourcing deal with Vertex cost the start-up utility £3m up front, with an additional £15 per customer. Despite its problems, Sulley defended the decision not to create an in-house team.
This was first published in May 2000