Energy companies are relying on billions in customer credit.
According to The Mail On Sunday, Britain’s energy firms are ‘sitting on a hoard of £4.5 billion in credit balances’.
The report comes days after the energy regulator ditched plans to ringfence customers’ credit balances.
Ofgem came under fire for its proposal to only “closely” monitor how energy suppliers use their customers’ credit balances – the Chief Executive of Centrica accused the energy regulator of “an abdication of responsibility”.
The figure, revealed after research by Uswitch and The Mail On Sunday, is almost three times higher than spring last year.
An Ofgem spokesperson told ELN: “Consumers will always have their credit balances returned to them should their supplier go bust.
“These proposals are about finding the most cost-effective way to protect these credit balances that does not put more costs on already high bills. We think allowing suppliers to use some of their customer credit balances for innovation, operating cash and hedging but not for riskier spending liking funding unsustainable growth, is the right balance.
“This is a similar model to banking where customer debit and savings account cash can be used by the bank for general lending but cannot be used for playing the riskier financial markets.
“We will closely monitor how suppliers use their customers’ credit and take action where needed.”