Households across the UK are being encouraged to reclaim credit built up with their energy suppliers to “reset” direct debit payments, which have remained high despite a drop in energy prices.
Campaigners from the Warm This Winter initiative advise consumers not to cancel their direct debits, which could lead to higher unit costs. They emphasize that early summer is the ideal time to adjust energy payments for the upcoming year.
Figures from Uswitch indicate that UK energy suppliers are holding over £3 billion in customer credit, with nearly a third of UK households in credit throughout the year. Warm This Winter has calculated that the combined interest earned by firms from these credit balances was at least £159 million in 2023.
Energy consultancy Cornwall Insight forecasts that the typical household’s annual energy bill will decrease from £1,690 to £1,574 on July 1. This is a significant reduction from the cap of £2,074 set in July last year.
Martin Lewis, founder and chairman of MoneySavingExpert.com, recently highlighted that while it is prudent to accumulate credit during the summer to cover higher winter energy costs, May is the perfect time to address the issue of firms holding onto billions of pounds in customer credit.
Fiona Waters, a spokeswoman for Warm This Winter, stated, “Energy companies are sitting on over £3 billion of bill payers’ money whilst providing an appalling service in many cases and making billions in profits. The Big Energy Claim Back is a way people who pay by direct debit can issue a wake-up call to companies that customers are not prepared to be ripped off anymore and demand energy suppliers provide a fit-for-purpose service.”
An Ofgem spokeswoman noted that building up credit during the summer helps spread costs over the colder months. However, consumers have the right to request their credit back and should discuss their circumstances with their supplier. If credit requests are denied, customers should escalate their complaints to the independent Energy Ombudsman.
Warm This Winter has released a guide with advice on how consumers can reclaim their credit. The guidance includes:
- Ensure your meter readings are up to date.
- Check your energy bill or online account to determine if you are in credit or debit.
- If you are in credit, contact your energy company to request it back.
- Before taking action, ensure you can afford higher monthly bills as withdrawing credit may increase your direct debit payments.
For more information and to access the guide, consumers are encouraged to visit the Warm This Winter website.
