Energy companies told to return £400m from closed accounts
Ofgem is urging the UK’s ‘Big Six’ energy firms to work harder to hand back the millions they owe ex-customers with closed accounts that are still in credit.
Ofgem has told the UK’s biggest energy companies they must do more to return over £400 million owed to former customers that's now sitting in closed accounts.
The regulator found that the 'Big Six’ energy suppliers (British Gas, SSE, EDF Energy, npower, E.ON and Scottish Power) weren’t doing enough to return credit left on an account after customers switched suppliers or moved home.
Ofgem said an ‘unacceptably large’ amount of money is being retained rather than returned to customers.
It wants energy companies to build on recent commitments to provide automatic refunds to direct debit customers who are in credit and take action on closed accounts still in credit.
Andrew Wright, Interim Chief Executive of Ofgem, said: “We want to see decisive action by suppliers, individually and collectively.”
Six-year build-up
Ofgem analysed data from closed accounts still in credit spanning the last six years.
The regulator estimates that at least £202 million from 3.5 million former household customers and £204 million from 300,000 former business customers is sitting in closed accounts.
Ofgem said it wanted to see suppliers do all they can to ensure credit is returned to customers.
If money can’t be returned for any reason the regulator said it should be used to ‘benefit energy customers more generally’ and companies should provide proof of how this has been done.
And it also wants energy suppliers' policies and processes to prevent such large sums being retianed in the future with 'crystal clear' communications when customers close an account.
Returning credit balances can be difficult for suppliers if no new contact details are left when moving house or if there is no next of kin when a person dies.
Ofgem will also continue to investigate whether suppliers' policies on returning money to customers comply with existing rules.
What to do if you think you're owed money
Ofgem is advising customers that have switched supplier or moved home to get in touch with their former supplier if they believe they are owed money.
You will need to have your old account details to hand as well as the former address these were registered to.
If you think a deceased relative may have a closed account in credit you will need to be able to show entitlement to any proceeds of their estate if you want to get the money out.
Ofgem also says you should take meter readings before switching supplier or, if you are moving, provide a forwarding address to the supplier you are leaving.
Compare energy tariffs and see if you can save by switching
More on energy:
Big energy companies face new rules on prices and profits
Price cuts mean Ovo now boasts the cheapest energy tariff
Alternative energy-saving techniques: will they save you money?
Most Recent
Comments
-
The power company employee lobbyists are on this post like hot potatoes. I don't believe their lies. I can stand their insults. But I wouldn't touch their source information with a barge-pole. These same lobbyists are in the pocket of government. I'm going to leave them to talk to each other, telling us how marvellous are the benefits of electricity and ignoring any suggestion that the various pollutants they inject into the atmosphere do any harm. If they were to be suspended in the exhaust plume from their power stations, a few breaths would be enough to finish them off. But the truly significant thing is that it is obvious that their job is to talk up their business and to ignore totally (yes, not one word on the subject) the thrust of the article they pretend to comment upon. They are truly beneath contempt.
REPORT This comment has been reported. -
Because the power companies charge extra for pay as you go. I too dislike direct debits, but have had to accept them reluctantly. I believe that they are the financial equivalent of have having a stranger's finger inserted you know where!
REPORT This comment has been reported. -
Why on earth do people set up Direct Debits, pay as you go is far better, at least one knows what one is paying for. By setting up Direct Debits, you may as well hand over your wallet to these devious characters to help themselves as and when they like. Would one set up a Direct debit with a Super Market, and let them assume what purchases you make on a monthly basis?
REPORT This comment has been reported.
Do you want to comment on this article? You need to be signed in for this feature
03 March 2014