Read on to learn just what a backdated energy bill is, as well as when you might receive a backdated gas or electricity bill with Business Energy Comparison.
How Long Can An Energy Supplier Backdate An Energy Bill?
Why You Might Receive A Backdated Energy Bill
The energy company is ultimately responsible for issuing accurate gas and electricity bills, and most of the time they manage to charge customers the right amount. However, the need to backdate a bill is not uncommon.
The most common cause of back billing is if there have been one or more inaccurate meter readings, or your direct debit payment has gone awry. This can happen to users of both business and home energy.
Estimated meter readings
Many households and small businesses pay their energy bills based on estimated meter readings. This might seem like the quick and easy way to approach it (because who wants the hassle of manually checking the meter every month, right?) but for a month where you use a little more energy than normal, this can lead to an undercharge.
No, an undercharge is not something to celebrate. An undercharge will lead to a back bill.
Incorrect meter readings
Much the same as above, but this scenario refers to when a meter reading has been taken manually (you know, the old-fashioned way) but recorded incorrectly. Or perhaps, the meter itself is displaying an incorrect energy use.
If you have cause to think your meter reading might be too high or too low, contact your energy supplier and ask them to confirm. If you continue to believe you are using more energy than your meter says (or less) it is worth investigating whether the meter itself might be faulty.
Paying for the wrong meter number
It happens. Due to an administrative error, usually by the energy suppliers, you might find yourself paying for someone else’s meter instead of your own. If this happens you might be paying for either more energy than you have used or less.
If you are paying for less energy, you can expect the other party to solve the mystery and when they do, you will receive a back bill from your energy supplier.
Cancelled direct debit
Many domestic and business customers choose to pay their energy suppliers by direct debit. This is fine, for the most part. Many energy supplier companies charge a more competitive rate if you agree to pay by direct debit. That being said, direct debit is prone to administrative errors.
It might also be accidentally cancelled. If you have changed bank details or queried your direct debit, it might have been automatically cancelled. This will result in an underpayment, which your energy supplier will rapidly rectify when they figure it out.
How To Avoid A Back Bill?
The easiest way for any consumer to avoid getting that nasty back bill surprise is to take an accurate monthly meter reading and never, ever base your payment on an estimate. The thing is, the energy company will most likely figure out whether you have been accurately charged sooner or later, so pay now, and avoid that added cost later on.
It is also a good idea to confirm that all bank details are correct and that any direct debit payment is being taken at the right intervals throughout the year.
Smart meters are gradually working their way into domestic and commercial UK properties and, while there might not be a legal obligation to change right now, it could save you time and a little money to do so.
A smart meter reading is automatically sent to the energy company regularly. This means you do not have to check the meter yourself or wait for someone else to do it either. Sure, you might still receive an inaccurate charge once or twice, but with a smart meter, the likelihood is greatly reduced. No inaccurate reading means no sudden back bill!
An energy supplier is entitled to backdate an energy bill for as long as 12 months following an underpayment. Undercharging happens, most often due to an incorrect meter reading or clerical error. This is no cause to celebrate, however. The energy supplier will figure it out and send a catch-up bill for the amount owed.
On the plus side, provided you have not wilfully avoided payment or obstructed a meter reading in any way, the energy supplier only has 12 months to chase that payment. The Ofgem back billing regulations prevent the energy supplier from chasing money owed more than a year ago so long as the error was their fault.
If you do receive a back bill, try not to panic. Contact your energy supplier and ask about a payment plan. Most often, the amount owed will not be due up front but instead spread across, for example, the next 12 bills.
The key takeaway? Provided you have no part in the error, you are only chargeable for the past 12 months. Even if you have been undercharged for more than that, if the mistake is down to the energy supplier, you will only be expected to pay for the last year’s energy.
Frequently Asked Questions
An energy company may send you a catch-up bill for energy use within the last 12 months, provided they failed to conduct accurate billing in the first place. If the error, or failed payment, is the fault of the customer, the energy company may chase the money owed for as long as six years.
The rules for back bills do not apply to any consumer caught stealing gas and electricity. In this case, the energy supplier is entitled to charge for stolen energy and since there was no mistake on their part, the back bill regulations do not come into play.
Yes, this can happen too and when it does, both business and domestic customers are entitled to a refund for any amount overpaid on energy bills. Perhaps you have moved property, or else you were the other party in the wrong meter mix-up. Whatever the reason, if you think you might have paid too much, ask your energy supplier to double-check.
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