Utility Bill Refunds

If you currently pay for your gas and electricity by direct debit it is possible that you may have a credit on your account. The following information explains how to request a refund and ensure your direct debit is set at the correct level.
When you pay by direct debit, your supplier will usually estimate how much energy you will use throughout the year. They will then work out how much this will cost and split the amount in to twelve monthly payments. This usually means in the summer when you use less energy you will build up a credit. This will then be used to offset the cost of the extra energy you would usually use in the winter. It is designed to allow you to budget more easily by not having a larger payment in winter than in summer.
However, in some cases the amount of energy that your supplier thinks you will use can be overestimated, which, in turn means a direct debit can be set at an amount higher than necessary. This can happen when you switch to a new supplier to obtain a cheaper deal. It is possible that this new supplier could over estimate your usage and set the direct debit too high. This means you could accumulate a large credit on your account. This could be money that you could use for other things.
It is worth noting that just because there is a credit on your account your supplier may not be doing anything wrong. As mentioned previously energy usage is seasonal and a monthly direct debit helps people to budget more effectively for the increased usage in winter.
Some suppliers will review accounts and automatically refund credit balances above certain amounts. You could check what you current supplier’s policy is by contacting them or checking their website.
What can I do?
After many years of complaints Ofgem, the utility regulator, has issued new licence conditions to suppliers. These set out guidelines for fair and reasonable direct debits.
Under Condition 27 of the Gas Supply Licence suppliers must:
• Set fair direct debits. They must take reasonable steps to ensure direct debit levels are based on the best available information, including looking at the history of the account.
• Give clear explanations. If you ask, your supplier must give a clear explanation for the basis of the direct debit amount.
• Refund credits. If a credit has accumulated and a customer requests it back, suppliers must refund it. If the supplier thinks the credit should be withheld, the reasons why must be clearly explained.
Always do a meter reading
To ensure your bills are accurate you should provide regular meter reading to your supplier. This will ensure bills are not based on estimates.

Ask for your money back
As explained previously, being in credit is not necessarily a bad thing. However, if you are in credit by a significant amount, especially after winter bills have been paid, contact your supplier and ask for a lump sum of your credit repaid. If your supplier refuses they must give a reasonable explanation as to why they will not refund your money. Some suppliers will review an account annually and automatically refund any accumulated credit above a certain amount.
Request a lower Direct Debit
You have a right to ask your supplier how they have set your direct debit payment. If necessary contact them to ask the question. If you are always in credit and it is not just during the warmer, lighter months, ask your supplier to base your direct debit on your actual usage. It is worth noting that a supplier will usually err on the side of caution and set a direct debit to incur a small over payment. This is to prevent any unexpected shocks at the end of the year.
What do I do if my requests are declined?
If your polite requests for a refund or a lower direct debit are declined without a good reason you may need to make a formal complaint. You should write to your supplier requesting either a refund, a lower direct debit, or both explaining that they may be in breach of their licence conditions or in breach of the Energy Retailers code and that you may switch suppliers if your request is not agreed.
The final option is to make a complaint to the Ombudsman Services for Energy. It'll check your supplier has stuck to the industry's code of practice and can award compensation if not. They can be contacted at www.ombudsman-services.org or by telephoning 0330 440 1624.
More information
You can get further information published by Which? By clicking here http://www.which.co.uk/energy/saving-money/guides/keeping-your-energy-direct-debit-in-check/your-energy-direct-debit-rights/