Energy Suppliers Allegedly Holding Customers’ Refunds Ransom

Some customers who have overpaid their energy suppliers say they are still waiting to receive their refunds after months of delays.

Meanwhile, they are struggling with direct debits and other problems, according to This Is Money.

Delayed Refunds From Energy Suppliers 

Customers often will overpay their suppliers during the summer months, the use that built-up credit to pay the higher bills that come in winter. 

But, This Is Money reported, suppliers have been holding on to large sums of consumers’ money.

Retired teacher David Barton, 73, said he watched credit build on his Avro Energy account until he finally switched to Utility Warehouse out of frustration.

Avro Energy told him he would receive a final bill within six weeks and a £830 refund within a further 10 days, the maximum amount of time allowed by regulator Ofgem.

Barton was able to get his refund sooner, but only after intervention by The Mail on Sunday.

Customer Robert Mabley said he requested his energy supplier refund him £200 out of a £300 credit on his account; however, Mabley said, the credit vanished and the amount of his direct debit increased from £64 to £73 a month.

He says he still has not received an explanation from his energy supplier.

Another man told The Mail on Sunday he was refunded only half his credit. He said the energy supplier told him it was allowed to keep a buffer of up to two months’ direct debit payments.

“If I were a new customer, I wouldn’t be expected to pay two months at the start of my contract as a buffer — why should I now?” he asked.

Companies Forced to Issue Refunds

Last year, tens of thousands of Bulb customers were refunded after they were overcharged or blocked from switching companies.

The supplier refunded nearly £2 million to 61,000 customers after it was determined the company had not complied with Ofgem regulations.

Ofgem found Bulb was not only charging its customers too much, but it was also preventing nearly 4,000 customers on Restricted Meter Infrastructure (RMI) from being able to switch companies, which in turn prevented them from saving money on their bills.

Also in 2020, British Gas paid out  £1.73 million, including £1.48 million directly to prepay customers, after Ofgem found the company did not advise vulnerable customers about a transition of top-up providers, nor did it inform them of the change in top-up minimums from £1 to £5

While the company did alert most of its customers about the changes in December 2019, about 270,000 were not informed, and as a result, Ofgem said, some of those customers lost their energy supplies during the winter.

What Can Consumers Do To Get Their Refunds From Energy Suppliers?

According to This Is Money, there are steps consumers can take to fight back against energy suppliers.

• Request a credit refund. Suppliers should repay this money promptly; however, some may be held back to prevent debt from accruing over the winter. If you think the company is withholding too much, complain in writing.
• Demand a direct debit payment review if credit is building up too fast.
• Refer rejected or neglected complaints to a mediator. If the complaint was dismissed or if eight weeks have passed, you can take the case to the Energy Ombudsman online or by calling 0330 440 1624.
• Provide your supplier with meter readings every three months. This will enable the supplier to predict your energy usage more accurately.
• Address energy problems through Citizens Advice online or by calling the consumer helpline, 0808 223 1133.

Switchcraft chief executive Andrew Long told This Is Money energy suppliers keep consumers’ money to use it to run their business.

“If you want your credit balance back, suppliers are not allowed to refuse without good reason. But you will need to be insistent,” he said. “Threatening to switch supplier often helps.”

Have you had trouble getting a refund from your energy supplier? Tell us about your experience in the comment section below.

Check back daily for the most recent U.K. class action lawsuit and consumer protection news.

Read More Lawsuit & Settlement News:

• School Closures Amid COVID: What Are Your Rights?
• UK Supreme Court Opens Door for More Class Action Lawsuits
• TikTok Collects Children’s Data, According To Legal Action by 12-Year-Old in England
• Tesco, Pizza Hut, Costco Among Companies Investigated for Short-Changing Employees