The UK’s major energy suppliers have collectively paid out £20.4 million over five years due to billing mistakes, with Centrica—the parent company of British Gas—shouldering the largest burden. This financial repercussion underscores a broader issue within the energy sector, where billing complaints accounted for 54% of all customer grievances. The period saw complaints spike, especially in 2023, when billing issues peaked at 67,295 cases. In 2024, Citizens Advice reported 59,773 billing-related cases as the sector grappled with ongoing challenges, including the aftermath of Covid-19 and rising energy costs.
Centrica, the largest energy provider with over 7.5 million residential customers through British Gas, paid out £4.15 million, representing the heftiest portion of compensation. The Energy Ombudsman found against Centrica in 2,396 billing complaints in 2023 alone. Between October 2023 and September 2024, complaints against Centrica escalated to 17,965, highlighting a significant customer dissatisfaction trend. Other major players like Ovo and EDF compensated £1.28 million and £426,000, respectively, indicating widespread issues across the industry.
The energy sector has faced numerous hurdles since 2020. The pandemic, supplier failures, and surging gas and electricity costs have compounded the situation, causing a 141% increase in billing complaints over five years. The financial compensation for these complaints surged from £2.4 million in 2019 to £7.1 million recently. Despite efforts to address these issues, National Energy Action warns that the recorded complaints might only scratch the surface of the problem.
“Our advisers often hear from people who are barely making ends meet, and an inaccurate bill not only risks plunging them into debt, but can take huge effort and stress to resolve.” – Alex Belsham-Harris
The Consumer Rights Advocacy stresses that Ofgem must implement measures to prevent exorbitant back-billing charges and enhance service standards. Addressing these systemic issues is crucial for assisting customers struggling with billing inaccuracies.
“Energy consumers simply can’t afford to pick up the tab when something goes wrong. Ofgem must limit back-billing to curb the amount customers can be charged, and it should raise service standards so people struggling with billing issues get the help they need.” – Alex Belsham-Harris
Smart meters have been touted as a potential solution to mitigate billing errors. Regular meter readings or installing smart meters significantly decrease the likelihood of inaccurate bills, providing consumers with a tool to contest any discrepancies effectively.
“We also know that installing a smart meter, or taking regular meter readings, both greatly reduce your chance of being inaccurately billed, and helps you to challenge it in the case you are.” – Peter Smith
Nevertheless, vulnerable consumers often bear the brunt of billing mistakes. The financial strain coupled with stress can be overwhelming, particularly for those unaware of their rights or avenues for challenging errors.
“Sadly, we have witnessed the impact when an inaccurate, or shock bill, pushes a vulnerable consumer to breaking point. Beyond the financial impact, the stress and anxiety are often unbearable and affect people’s daily lives.” – Peter Smith
“Often these types of consumers won’t be aware of routes to challenge misbilling, or seek compensation, so this increase could just be the tip of the iceberg.” – Peter Smith
The Energy Ombudsman acknowledges that while complaint numbers have begun to decline from their 2023 peak, they remain elevated compared to pre-pandemic levels. This indicates ongoing tensions between consumers and suppliers as they navigate a complex landscape of disputes.
“The sector has faced a series of challenges since 2020, including Covid-19, specific supplier failures, and then huge increases in the cost of gas and electricity.” – The Energy Ombudsman
“Each of these has brought new problems for both consumers and suppliers, and makes it harder for both sides to come to a resolution when disputes arise.” – The Energy Ombudsman
“It’s important to note that disputes have started to come down from their peak in 2023, despite remaining higher than previous years.” – The Energy Ombudsman
British Gas has expressed remorse over specific incidents involving customer service failings, attributing some issues to estimated meter readings impacting account balances.
“We’re sorry for the customer service Ms Wescombe experienced. The outstanding balance built up due to estimated meter readings on the account for some time.” – A British Gas spokesperson