Reclaim energy bill credit

energy prices

FOR those who pay their energy bill by direct debit the balance can often tip into credit, due to overestimated usage by the supplier. Traditionally a lot of energy customers have not claimed back this credit.

In recent years the fact that energy companies have been holding onto unclaimed customer cash has led to public anger and action by the Government and Ofgem.

This guide aims to explain how energy bills get into credit and how customers can ask for a refund from their energy supplier.

Sometimes people encounter problems with the refund process so we also look at how to complain to the big six energy companies.

Finally, we touch on how sometimes being in credit with an energy supplier can earn rewards at often surprisingly high rates of interest.

For general information on dealing with energy bill problems, look at our guide here.

How energy bills get into credit

For people who pay for their energy bills by direct debit the amount of energy they consume in one year is estimated by the energy company. Estimates are based on a customer's previous consumption, along with other factors like the seasons.

Seasonal variations

Based on the weather, the amount of energy we use changes from month to month but energy companies expect customers to pay a fixed monthly direct debit.

This works in theory, because the monthly direct debit should build enough credit throughout the summer to be used up in the colder winter months.

This can cause problems though, for example if the direct debit is not set at the correct amount for a customer's actual consumption, or if seasonal factors, like a mild winter or a long summer, mean that a customer uses much less energy than predicted.

Below is a graph which shows how homes use energy throughout the year.

energy use over seasons

However, despite the problems that can come with paying by direct debit, it usually saves customers money on their energy bills.

Here's how much paying by direct debit saves a year with the big six:

Direct Debit saving
British Gas Varies with tariff, but most give 0.31 p/kWh for gas, and 0.93 p/kWH for electricity.
Average savings of £43 per year on gas and £30 per year on electricity
E.ON £35 per fuel
EDF 6% or lower rate depending on the tariff
Npower £40 electricity, £50 gas, £90 for both
Scottish Power Varies by tariff
Scottish and Southern Power (SSE) up to £40 per fuel

At the time of writing many smaller suppliers, including Co-op, Ebico and Ovo, don't offer direct debit discounts. However, Ovo do offer a saving of up to £60 per year for customers who manage their account online.

Credit for a complaint

Credit can also build up on an account when energy customers receive compensation after making a complaint.

Although it's not possible to cover all the ways that energy companies fall short of required standards, compensation is usually awarded when a product is mis-sold or when bills are wrong for a long period of time; for example, because the energy company didn't fix a faulty meter.

Occasionally big errors mean a payout for thousands of customers at once, like the £63 million Npower paid out in 2010.

More recently, in 2015 Npower were fined £26 million after 500,000 of its customers received inaccurate and late bills, and were subject to incredibly poor complaints handling by the company.

But it's not just Npower that have been punished with hefty fines.

In October 2016, Co-op Energy were fined £1.8 million by Ofgem for poor customer service and in January of this year British Gas were subject to a £9.5 million fine for billing mistakes due to a new IT system.

In all cases Ofgem required that the money be split between affected customers and energy charities like StepChange.

Credit left after a switch

Finally, credit may be left in an account as a result of a mix-up when a customer switches supplier - usually when moving house.

The final bill that settles an account with an old supplier often has unused credit left on it, and it's often the case that this credit goes unclaimed as people go about establishing their supply with a new company.

To ensure that account closures don't cause mistakes, customers should keep hold of their old account details and final meter readings and then check with their old provider, or go through

For anyone who thinks that a closed energy account may be in credit, see our section below on how to get a refund.

What to do when a bill is in credit

A bit of history

The scandal of energy companies holding onto customer credit is not new: in November 2013 a whistleblower claimed British Gas had made £20 million by funnelling unclaimed bill credits back into their business.

In the same month, it emerged that Npower were holding £400m in positive balances.

As a result, in February 2014 the Government began to apply pressure on the big six energy companies to reunite customers with their cash.

This resulted in automatic credit refunds for customers who paid by direct debit if they were in credit at the point of their annual bill review.

In addition to this, under pressure from the energy regulator Ofgem, in October 2014 a campaign was launched called 'MyEnergyCredit'.

The campaign, which all six of the main energy suppliers support and which is still ongoing, aims to give the unclaimed credit that they hold onto back to their customers.

After the campaign was launched the energy suppliers made changes swiftly.

By December 2016, Ofgem stated that nearly £670 million of credit had been returned to customers since the campaign was launched in 2014, and that most customers got their refund within 14 days of a final bill (and an accurate meter reading).

Refund policies of the big six

For those who need a credit refund, here is how the process works.

When a direct debit comes up for review the supplier will look at the amount in credit, and if it's over a certain amount, shown below, they'll refund it automatically.

Suppliers must review accounts annually, but some do it more than once a year - especially if they are provided with up-to-date meter readings.

The direct debit review is supposed to check whether payments need to be adjusted depending on usage. Any possible credit on an account will therefore depend on that process.

If a credit balance is under an energy supplier's automatic refund amount, they might keep the credit balance because they consider that customers are better off using it to pay their bill.

Here are the automatic refund policies of the big six:

Account reviews/year Old amount for automatic refund New amount for automatic refund
British Gas 2 £100 £5, with an accurate meter reading
E.ON 1 £150 £5
EDF 1 £75 Any amount in credit
Npower 2 £60 £5
Scottish Power 1 3 months of direct debit payments
Average bill is £1,200 so that's £300
Note SP pay in credit
£75, or more than one month's payment amount
Scottish and Southern Power (SSE) 1 £100 Any, with an accurate meter reading

How to request a refund

Under Condition 27 of the Gas and Electricity Supply Licence Conditions energy suppliers must give a refund to customers if one is requested. This applies even if the credit amount is below the automatic refund level.

To request a refund from an energy supplier people should first check their energy meters. The readings will give the company an accurate picture of usage and how much credit a household may have.

The following links can be used to check the refund policies of the big six suppliers:

Licence conditions specify that refunds must be made "in a timely manner", but as Ofgem stated, most customers get their refund within 14 days.

No refund? How to complain

Those who have requested a refund but haven't received it are entitled to make a complaint to get the issue resolved.

People who include their customer number(s), the date(s) they contacted the supplier previously and how much they're owed, and who keep it brief and polite, tend to get the best results.

The suppliers' formal complaints procedures are available here:

If after eight weeks a complaint hasn't been resolved the problem can be taken to the Ombudsman, an independent adjudicator that is approved by Ofgem and is able to resolve the dispute.

Customers can't skip straight to this step. They need to show the Ombudsman that they've made their best effort to resolve the problem with the supplier, and be prepared to produce the paperwork regarding the complaint to demonstrate this. There's more on how to do this here.

The Ombudsman used by the big six energy firms is available here.

Cash for accounts in credit

Finally, note that in some cases having credit in an account can be a good thing because some energy companies reward customers for not going into debit.

Of the big six, Scottish Power are the only supplier that reward customers for being in credit. As long as an account is over £100 in credit at the time of annual assessment the company will pay £1 for every £33 over this amount, up to £496.

So, if an account is £199 in credit the account holder would get £3. The upper limit of £496 gets a £12 reward.

Smaller provider Ovo Energy also pay out when an account is in credit.

After the first year, the Ovo Interest Rewards scheme pays customers 3% at the point of generating their statement. If customers stay for a second year the reward increases to 4% and a third year gets customers a 5% bonus, and 5% every year thereafter.

In this way Ovo reward customers for being in credit and for being loyal to the company, and when you consider that it's tax free it earns more than most savings accounts.


25 August 2017

I was owed £1,140 by Npower after they had been estimating my electricity usage for a long period despite me giving regular readings online (which were ignored as infallible). After weeks of being promised a refund, I was told that it was being treated as a down payment for future usage. Ok, well why were they still taking my direct debit every month? Now it's been recalculated to £900 odd, again I don't know why. I've now been told it's with the high value refunds department but I still haven't received anything. Does anyone know if you can claim interest on what they owe to you?

20 September 2017
Edel Holyoak

It says on my Npower account I am £5070.00 in credit, some is towards my October bill. I have tried to phone, 40 minute wait no matter what time of day. I did live chat to be ignored by one and told by another they have to pass me to smart meter accounts as they can't help - to be disconnected by the third person. Very unprofessional. I have put a complaint in - we'll see what happens.

10 August 2016

Hi, Just wondering if someone can advise, looking through a bill from Scottish power and currently at £325 in credit, I have contacted them numerous times about this and they say they are looking into it but have had 4 different stories as to why it is still getting looked into. They are now saying that because we have a key for the meter they do not need to give us the cash as we only get it if it is Direct Debit
Any advice greatly appreciated.

17 September 2015

In £2000 credit with Npower and struggling to get it back.

12 March 2015

Scottish Power owe me over £1200 from being in credit and won't give me my money back as they say I'm a "difficult case" and they need to work out what to do. I'm really struggling for money yet they're earning interest on my money when it should be in my bank!

13 March 2015

Scottish power owe me over £1k and I am having similar problems since I closed the account following a switch. I keep getting the 'in 5 working days' replies and generally being fobbed off.

9 March 2015

Npower owe me £500 and struggling to get this back!

5 February 2015

They just con you. I have had lies promising two bills within days, anything to avoid paying me back the £500 they hold of mine.

12 January 2015

After switching energy companies in December 2013 I was over charged on my final bill by £391, it was all a mix up between the old and new company which took till mid June 2014 for the money to be repaid to me. I didn't realise that they'd made 2 payments of £391 weeks apart from each other, it took them till December 2014 to notice as well, I've now received a letter asking for £391 back. Can they insist on full payment straight away?

29 October 2014
Sam Turner

Scottish power took a further direct debit payment of £117 one day before my changeover to an alternative supplier on 3/9/14, despite knowing that my account was £300+ IN CREDIT. They have ignored my complaints, not telephoned me back, despite the agreed arrangement for a booked call back at a specific day and time. Other than an automatic response to my e-mail stating that they will respond within 5 days, which again they have failed to honour.
I have also complained to the OFGEM complaints department who again have simply acknowledged the e-mail and I have had no further response to date.
It seems that these companies are above the law and when and if they are fined by Ofgem they simply add the cost of the fine to their net costs and use this as justification to increase their charges. Isn't it about time the fines were levied on the directors then perhaps complaints would diminish and customer care would improve?

26 October 2014
Garry Clarkson

Sadly this is the depth of fraud and theft in the energy market Thatcher set up. There is nothing you can do. Even going to Ofgem (which I did) means they get a fine which then goes into government coffers. Fill in a form at the court service web site. They rarely turn up (as their 'barrister' is in fact not even registered as a solicitor barrister but says he is - again, fraud). Nothing done by Ofgem, Ombudsman, government or police. In my industry I would be struck off at the first complaint.

16 October 2014
Keith Reeder

British Gas owes me the thick end of £1400, and have for over a year. In addition, they've "made up" readings I've submitted, adding a meaningful amount to every reading I've sent in over this period. And they've cacelled my DD, and I'm unable to reinstate it. "Best" of all, they say they sent a check to me in December last year. I didn't get it, but they still deducted £1150 off my credit balance. I'm currently in discussion with my solicitor - this is getting VERY close to fraud and to theft.

9 May 2014
paul lewis

Npower just gave me a £179 refund, £10 reduction off my monthly dual bill and £30 compensation for lack of correspondence and acknowledgement of my request.

5 May 2014

My credit with NPower currently stands at £925 and increasing. I have requested a refund and am waiting. Anyone think £925 is highly excessive?

13 October 2014

I was over £600 in credit (and usage 36% down on last year) after my Winter/Spring bill around April time and not only did they REFUSE to refund the credit they also increased my monthly DD.

5 February 2015

Same with me, they owe me £500 and when I complained and asked for it back they doubled my direct debit from £42 to £96. Crooks.

30 April 2014

Having trouble with npower, £339 in credit, they keep doing bill reversals. Can anyone explain bill reversal?

13 June 2016
Clive Rennison

Same issue here, my account stands at a whopping £1300 in credit, I have been chasing them for weeks now and keep being fobbed off with 'it's with the backroom team' for the final bill to be produced. I am getting increasingly more and more frustrated with them. They are saying that ovo still haven't provided them with the meter readings. I don't belive it for one second! They are doing everything possible to delay me getting my money back, does anyone have any help they could offer please?

1 September 2014

I'm having exactly the same problem. They owe me £745. There must be someone we can contact to get a refund!

» Read more of the latest news

» Search for more guides on money

Follow us or subscribe for FREE updates and special offers