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Energy companies owe customers £1.2bn

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02/05/2014
Energy firms are hoarding billions of pounds worth of customer money, according to new research.

The study by Gocompare.com revealed that half of UK households have a credit on their energy bills, with the average customer owed £90.20.

This means utility providers are profiting from a staggering £1.2bn in overpaid bills, the comparison site said.

Gocompare.com is urging consumers to contact their providers and request refunds.

Energy companies calculate the amount of direct debit customers owe based on an estimate of their annual use which is then divided into 12 equal instalments.

While this can smooth out seasonal fluctuations, surpluses build up quickly when monthly payments are overestimated.

Jeremy Cryer, energy spokesperson at Gocompare.com, said: “While many people prefer to carry a ‘summer surplus’ to cushion winter bills, if you find your account is in credit after they have been paid you should contact your energy provider to ask for your money back.”

He continued: “It’s also likely that your direct debit payment has been set too high, so give a current meter reading and ask for your future direct debit payments to be reduced if possible.”

In February, the regulator Ofgem ordered the ‘Big Six’ energy companies – British Gas, SSE, npower, Scottish Power, EDF Energy and E.On – to repay £400m of credit sitting in closed accounts back to former customers.

In response, five suppliers – British Gas, EDF Energy, First Utility, npower and SSE – agreed to automatically refund customers with any credit on their account.

E.ON automatically refunds direct debit customers who are £5 or more in credit, and Scottish Power does the same for those who are either £75 or more in credit or have had a balance of any amount for over a month.

Meanwhile, a separate survey by uSwitch found almost four million UK households are currently in debt to their energy supplier.

The comparison sife calculated that the average household energy bill now stands at a £1,265 – 168 per cent higher than a decade ago.

 

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