Reclaim energy bill credit
Energy bill credit - a positive balance that has usually built up because the supplier overestimated usage - has often gone unclaimed in recent years.
It might sound like something you'd notice: 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 we update this article, in October 2014, a campaign has been launched aiming to reunite former customers with unpaid bill credit. Earlier this year the Government got energy companies to agree to start automatically refunding money when accounts are in credit, though the rules are still slightly different for each company.
Read on to find the rules for each provider and how to reclaim any cash owed, if necessary.
Bill credit: the rules
After last year's revelations about just how much cash energy suppliers are hanging on to, suppliers have made changes pretty swiftly.
Most will automatically refund accounts that are in credit by more than £5, though it's still worth checking and applying for a refund if necessary.
The suppliers' refund policies
This is how it works: When the 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 now need to 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 so credit will also depend on that process. The supplier might give the account holder the option to keep the credit in order to reduce the monthly payments, for example.
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||£75, with an accurate meter reading|
|EDF||1 (first review will be within 15 months of account opening)||£75||Any amount in credit|
|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
As we noted above, energy suppliers may keep a credit balance if it's under their automatic refund amount, as they consider customers are better off using it to pay their bill.
But under Condition 27 of the Gas and Electricity Supply Licence Conditions, energy suppliers must give a refund if one is requested.
The supplier will ask the customer to submit their request with a new meter reading, as they don't want to give away money that should be used to pay a bill.
Check the meter and then use the following links to check your supplier's policy on how to request a refund:
- British Gas
- Scottish Power (note that they give £1 for every £33 in credit though)
- Scottish and Southern Energy
How long should a refund take?
Licence conditions only specify that refunds must be made "in a timely manner".
British Gas say they aim to refund customers within four working days.
Npower and SSE expect to refund to Direct Debit customers within 10 working days, while Scottish Power customers and SSE customers who pay by cheque should have their refunds within 14 working 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 who will be 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 that.
The Ombudsman used by the big six energy firms is available here.
How energy bills get into credit
There's one main reason that energy bills get into credit - the seasons - plus a couple of more unusual problems.
Winter to summer direct debit confusion
The amount of energy we use changes from month to month with the weather, yet energy companies want their customers to pay a fixed monthly direct debit.
In theory, that shouldn't be a problem: sure, your account will go into credit in the summer but then you'll be able to use that credit when bills go up in the winter. With a direct debit, you're the ant, not the grasshopper.
In addition, when you buy gas and electricity from one supplier, a credit on one account may be used to pay down a debit on the other one so, again, your credit keeps things in balance.
However, when a direct debit is set too high it can leave an account constantly in credit, which is no use at all.
If you think that applies to you, go to our how to reclaim section above. If you're not sure, find more on changing direct debits down the page here.
Credit for a complaint
Credit can also build up on an account when energy customers receive compensation after making a complaint.
There's not space here to get into all the ways energy companies often fall short but compensation is usually awarded when a product was mis-sold or when bills were wrong for a long period - 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.
Credit left after a switch
Finally, credit may be left in an account as a result of a switching mix-up.
The final bill to settle an account with an old supplier often seems to cause some confusion and if the supplier change is because of a house move, the potential for credit to go unclaimed is obvious.
Customers should keep hold of their old account details and final meter readings, then check with their old provider, or go through MyEnergyCredit.com.
Avoiding getting into credit
As we noted above, accounts can get into credit because the Direct Debit is set at the wrong level.
But ditching Direct Debit is a bad idea because it saves money with all of the big providers and, when it's set up correctly, it does help ease those terrifying winter 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 elec, £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.
Cash for accounts in credit
Finally, note that in some cases having credit in an account can be a very good thing.
Scottish Power will pay £1 for every £33 that an account is in credit over £100.
So, if an account is £199 in credit the account holder would get £3. The upper limit is £496, or a £12 reward.
Ovo Energy also pay out when an account is in credit: they're paying 3% monthly or quarterly depending on how customers receive their bills.
When you consider it's tax free, that's better than most savings accounts.