‘Energy firms owe £1bn to half of Britain’

Energy firms owe as much as £1billion to nearly half of Britain, it was claimed yesterday. New statistics suggest nearly half (47%) of Brits have a positive balance on their […]

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By Vicky Ellis

Energy firms owe as much as £1billion to nearly half of Britain, it was claimed yesterday. New statistics suggest nearly half (47%) of Brits have a positive balance on their gas or electricity bills.

Research commissioned by comparison website Gocompare.com found that on average customers who are in credit to utility suppliers are owed £78.50, while one in five have a credit balance of £100 or more.

This means utility providers are profiting from nearly a whopping £1billion in overpaid bills, which was put down to people paying by direct debit (DD).

Jeremy Cryer from Gocompare.com said: “Paying utility bills by direct debit can be a good way of saving money as most suppliers offer discounts to customers paying in this way. However, the method suppliers use to calculate DD payments can lead to customers paying way more than they need to. By overpaying bills you are effectively giving a free loan to your utility supplier, when your money could be working harder for you.”

Suppliers calculate the amount you pay based on an estimate of your annual consumption, he said, then usually divide this into 12 equal payments and charged monthly.

Mr Cryer went on: “While DDs can help your household budgeting by smoothing out seasonal variations in energy usage, if the estimation of usage has been set too high, a sizeable surplus can quickly build up.”

Customers should review their accounts to reclaim their “hard-earned cash,” he added.