UK Edition
Faith in energy firms among consumers is falling to record lows amid soaring bills and a series of high-profile scandals.
In the year to May 2022, the proportion of people who told consumer group Which? they “distrust” their supplier more than doubled, from 20pc to 44pc.
The charity National Energy Action estimates that 8.4 million households will be in fuel poverty from April, an increase from 6.7 million today and just 4.5 million last October.
This makes it more important than ever to be aware of the tricks that firms use to make more money out of their customers – and the holes in government support schemes that it is all too easy to slip through.
Increasing direct debits
Around 56pc of customers pay their energy bills by direct debit, according to the regulator Ofgem.
Paying by direct debit allows customers to spread costs evenly across the year, overpaying in the summer when usage is low to help cut costs in the winter.
However, last summer it reported that the payments of roughly half a million people had been more than doubled by their suppliers and, although it said it had not found evidence of “unjustifiably” high bills, it requested those firms to review their accounts.
Some customers have experienced bill increases despite being comfortably in credit. In November, business secretary Grant Shapps warned firms not to increase bills for those who were making “huge efforts” to cut usage.
Suppliers should give at least 10 days notice of an increase in direct debit, and the charity Citizens Advice says if you are not happy you should ask the firm to explain why the change is necessary. You can make a formal complaint to your supplier or ask them for additional support if you are unable to pay.
A spokesman for Energy UK, the industry trade body, said suppliers are required to set direct debits on the “best and most current” information available and that the aim is to keep payments even across the year.
He added: “At a time when energy bills have been rising steeply, it’s inevitable that direct debits have risen significantly as well. And while a customer might be in credit, that balance might get eaten away quite quickly if you’re paying much more than you used to.”
Customers should send regular meter readings to their supplier, he said.
Matt Copeland, from the NEA, warned that some suppliers bill quarterly rather than every month. “This can give the illusion of having lots of credit when in reality it is needed for the bill. Before asking for your credit to be paid, check when your last bill (not direct debit payment) was issued,” he added.
Charging you extra to pay in cash
The Telegraph revealed that energy firms have been needlessly charging customers to the tune of £1.3bn for paying by cash, cheque or bank transfer.
The customers affected are disproportionately elderly households who prefer to pay when bills arrive. According to a survey by Octopus Energy, three quarters of standard credit customers were unaware that they were being billed more than those paying by direct debit.
The Energy UK spokesman said: “The cost to serve these customers is higher than for those paying by direct debit. It is up to customers to decide what suits them best.”
Those who are concerned they could be paying more should contact their energy firm to see what support is available, or whether it would be cheaper to pay via direct debit. In response to The Telegraph’s report, British Gas said it would work with customers to keep costs down.
Forcing you into prepayment
Earlier this month, it was revealed British Gas was entering people’s homes to fit prepayment meters where customers had built up debts. Further reports revealed other suppliers had also obtained hundreds of thousands of court warrants to fit prepayment meters.
Suppliers tend to use prepayment meters to recover debt, but the tariffs are usually higher and customers are at risk of being cut off.
After intervention by the Government, the suppliers agreed to halt forced installation of prepayment meters. No court warrant is required for customers with a smart meter, as suppliers can switch it to prepayment mode remotely.
The Energy UK spokesman said: “Any customers struggling with their bills is to talk to their supplier and see what help and advice they can offer before it gets to that point.”
Expiring or missed vouchers
Since October, the Government has been providing energy bill support to households worth £400.
But, unlike direct debit customers who receive the payments automatically, those with prepayment meters receive their support via vouchers which can then be redeemed when topping up. Figures show that only 71pc had been used as of late January.
Mr Copeland warned that some vouchers have been sent to the wrong address and that they expire 90 days after being issued. He added: “They can be reissued if you run out of time. If you haven’t received any of them, then get in touch with your energy supplier.”
The Energy UK spokesman said: “Suppliers have been doing their very best to get these vouchers to customers and teaming up with other groups to encourage customers to redeem them as well. If you haven’t received them, please get in touch with your supplier.”
Warm Home Discount
Changes to the criteria mean that as many as 500,000 households which were previously eligible to receive the £150 discount to their bills could now miss out on support, according to Mr Copeland.
Some households have reported issues accessing the discount if energy bills are registered in the name of someone who is not eligible, even if another person in the house could receive the benefit. Check with your energy provider whether you are missing out.