March 28, 2016
Citizens Advice have estimated that as many as 2.1 million households have been hit by large late gas and electricity bills in the last year, because energy suppliers have initially undercharged them.
The charity, which provides confidential information and advice to assist people with money, legal, consumer and other problems, made the estimate after surveying 2,000 people across the UK and found that 10% had been back-billed - where energy companies send a revised bill after undercharging.
On average the "catch up" amount was £206. Shockingly, 15% said they had been back-billed more that £250. In some case Citizens Advice seen cases of four figure sums being back-billed.
Energy suppliers can currently back-bill a customer for up to 12 months' worth of gas or electricity, even when it was the companies fault. Citizens Advice have said that in some cases customers can be back-billed for longer periods when the supplier argues the customer was at fault.
Billing errors are the biggest energy problem people contact Citizens Advice's consumer service about, with 16,000 cases seen last year.
Gillian Guy, Chief Executive of Citizens Advice, said:
"Customers shouldn't have to pay the price for suppliers' mistakes. Energy bills are already high so it adds insult to injury when companies go back to customers looking for more money after they got it wrong. Particularly for suppliers who insist on payment in full, this can be a huge burden on already stretched finances.
Smart meters provide a perfect opportunity to consign back-billing to the history books. As they are rolled out across the country OFGEM should ensure suppliers reduce the length of time they can back-bill customers."
Energy Secretary Amber Rudd said:
"This is very disappointing. I challenged the UK's biggest energy suppliers to bring down bills and pass on savings to consumers. They have dropped their prices which is a step in the right direction but errors on bills create unnecessary burdens and worry for hard-working people and I reiterate to all energy companies that they need to put their customers first and ensure that this does not happen.
We're installing smart meters to help people take control of their energy use and bring an end to estimated bills, as part of our plan to build a system of energy infrastructure fit for the 21st century."
Posted on March 28, 2016 at 12:33 PM