Posted: Wed 26th Apr 2023

Energy companies holding onto credit of more than 16 million UK households

News and Info from Deeside, Flintshire, North Wales
This article is old - Published: Wednesday, Apr 26th, 2023

New research by Uswitch.com, the comparison service, reveals that over 16 million UK households have a combined total of nearly £7 billion in energy credit balances with their suppliers.

This figure has risen by £5.3 billion compared to last year due to a mild winter, reduced energy consumption, and £400 in government energy support received by households between September and March.

The number of households in credit has increased by five million, up from 11 million last year, with more than eight million now holding credit balances of over £200.

Meanwhile, the number of households in debt to their energy providers has dropped from six million to four million, with total debt decreasing from £1.2 billion to £920 million.

However, the average debt per household has risen from £188 to £234.

Of those with credit balances, 53% plan to leave the money with their supplier to manage future bills, 18% will request a partial refund, and 14% will ask for a full refund.

While 64% of consumers have received an automatic refund in the past year, 54% admit they don’t know how to reclaim credit from their provider.

Plymouth has the highest average energy credit (£603 per household), whereas Glasgow has the lowest (£302) and the lowest average energy debt (£78).

Norwich, on the other hand, has the highest average debt at £348 per household.

A quarter of households in credit report higher balances this year, with 66% attributing the increase to government support, and 47% citing reduced energy use.

Two-fifths blame their suppliers for setting direct debits too high.

Uswitch.com urges consumers to check their credit balances and consider reclaiming excess amounts.

If the balance appears too high, they should discuss refunds or lower direct debit payments with their suppliers. Over 90% of people have received refunds within four weeks.

Richard Neudegg, Director of Regulation at Uswitch.com, said that energy-saving awareness campaigns and cost-of-living support have protected consumers from a potentially more challenging winter.

He also suggested that direct debits may have been set higher than necessary by suppliers in response to energy price hikes.

Neudegg encouraged customers to request credit refunds if needed and ensure their direct debits are set correctly.

He also highlighted the importance of continued support for those struggling with energy debt and accurate meter readings for customers without smart meters.

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