An energy consultancy recently highlighted the ‘missing millions’ owed to businesses due to utility billing errors, but have failed to mention a solution in order to tackle this. So what can do you about your utility billing errors, and how do you get your money back?
In 2017, a study by price comparison website uSwitch revealed that close to 1.3 million energy customers had been overcharged by a total of £102 million due to company billing errors.
- On average, each customer was charged £79 more than they owed.
- A third of affected customers said that their bills did not match their meter readings.
- One in four said that their energy bills didn’t add up correctly.
It’s possible that even more energy billing errors are occurring, but go unnoticed since over 27% of consumers admitted that they don’t read their energy bills carefully.
How long to get money back after an energy billing error?
In addition, it takes an average of 35 days for energy billing errors to be resolved.
- 10% of customers waited 1-2 months to get their money back
- 25% waited over two months to get their money back
And 7% of customers surveyed hadn’t received the fund due to them.
Typical energy billing errors include:
- 8% – Getting direct debit amounts wrong
- 7% – Applying incorrect fees
- 5% – Getting tariff or product details wrong
- 5% – Sending bills to the wrong customers
What causes gas and electricity bill errors?
- New IT systems
- Old meters
- Faulty meters
- Human error
- Company neglect of billing rules
What to do about energy billing errors
If you procure your energy through a broker like Smarter Business, we become your first point of contact for anything energy-related. If we notice an energy billing error, or if you make us aware of one, we’ll take up the issue with your supplier on your behalf. We’ll take it upon ourselves to ensure that you get any refund due as soon as possible.
If you don’t use an energy broker, you’ll need to report the error to your energy supplier. You can usually find the relevant contact detail’s and procedure on your supplier’s website.
Here are steps you can take to identify and prevent potential energy bill errors
Conducting a thorough, historic utility bill audit going back six years will enable businesses to claim back from suppliers anything they are due. If businesses are not already conducting rigorous bill validation presently, this is definitely an area that should be considered as the savings can be substantial. These savings can also unlock additional investment in energy efficiency, further reducing future bills.
It is often complex for businesses to manually undertake proper validation. However, with the use of specialist software and a dedicated resource, businesses can show not only current bill savings but also what they will save going forward by cutting out errors now.
Typically, more billing errors occur with a change of supplier. Although you may have been able to secure a better rate with a new contract, the risk of an error occurring with a new supplier handling your data increases. Historically, issues can also occur when a supplier implements a new billing system, for example, British Gas.
We are identifying errors on a daily basis which means money returned to our customer’s bank accounts and not the suppliers’.
Smart meters ensure that energy readings are based on actual energy use instead of estimated readings. Smart meters also give customers greater visibility of their energy consumption patterns and help them identify potential savings.
No more back billing
In May 2018, energy regulator Ofgem banned energy firms from charging catch-up energy bills. Previously, energy customers could have a series of bills based on an inaccurate estimate underestimating their energy usage. When an actual meter reading was taken and they were charged accordingly, customers could find themselves owing more than they could afford. Ofgem says that the typical back bill is £1,160, leaving customers struggling to pay or in debt.
Although many of the biggest suppliers voluntarily agreed to stop back-billing of more than 12 months since 2007, some have not fully complied and other firms hadn’t signed up. But things are steadily changing, with 80% of energy suppliers signing up to the Energy UK Billing Code to ensure greater accuracy of bills.
Better energy management
Are you concerned about the accuracy of your energy bills? Contact a Smarter Business energy consultant for expert energy management and take the hard work out of identifying and preventing energy billing errors.