News story

Putting money back in the pockets of energy customers

This news article was published under the 2010 to 2015 Conservative and Liberal Democrat coalition government

Greg Barker today called on energy companies to work together with government to ensure their direct debit terms don’t leave customers out of pocket.

Energy companies have been challenged to prove they are not over-charging their customers through direct debits.

In a meeting with energy suppliers and consumer groups, Energy and Climate Change Minister Greg Barker today called on energy companies to work together with government to ensure their direct debit terms don’t leave customers out of pocket.

Greg Barker said:

“With more hardworking people switching to direct debit to get the best deal on their energy bills, it is vital that they aren’t being unknowingly ripped off.

“The better energy companies will now automatically refund your cash if you build up more money than required to meet your normal bill or will pay you interest if you are in surplus. However, it looks like some companies aren’t doing that.”

At DECC’s request, Energy UK has agreed to develop, with its member organisations, direct debit best practice proposals. Suppliers have also been asked to provide information on the industry’s current practices for dealing with credit balances for consumers who have built up greater than necessary credit, and clear analysis of how much of their customer’s money the industry holds at any one time. This is to ensure all consumers are getting a fair deal from their energy company.

Energy suppliers have been criticised for continuing to increase direct debit payments even when consumers are already in credit, or holding credit accounts that relate to closed accounts. Government expects to see companies treating their consumers fairly, including being more transparent about their processes for returning credit balances to consumers.

In addition to tackling direct debits, government is taking action in a number of other areas to keep people’s bills down. This includes increasing competition, encouraging new players in to the market to offer consumers real choice, and helping the most vulnerable to get money off their bills this winter.

Attendees at today’s meeting included representatives from E.ON, SSE, Scottish Power, RWEnpower, EDF, British Gas, Consumer Futures, and Which?