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Power energy firms bank on customers for survival

Power firms bank on customers for survival as some households are told their monthly bills will more than double

  • Energy bills are doubling, some customers say, thanks to the energy crisis 
  • Some providers are refusing to refund customers credit balances 
  • This is despite Ofgem rules saying suppliers should refund in a ‘timely manner’ 


Energy bill hikes are beginning to bite as some households are told their monthly payments will more than double.

Providers are also clinging on to customers’ cash and refusing to refund credit balances worth hundreds of pounds.

Surging wholesale gas prices threaten to cripple dozens of suppliers, with 12 having collapsed since the start of the year. Three more firms went bust just last week, leaving another 233,000 families in the lurch.

Customers affected are moved to a new supplier and put on the firm’s standard variable tariff, which is often hundreds of pounds more expensive. 

Energy crisis: Surging wholesale gas prices threaten to cripple dozens of suppliers, with 12 having collapsed since the start of the year

They must then provide up-to-date meter readings and wait for any credit balance to be repaid.

Some firms are now promoting deals costing £2,000 — over £700 more expensive than the price cap at £1,277.

Even those with suppliers still in business are now reporting huge increases to their direct debit payments and long waits for refunds. 

When paying by monthly direct debit it is normal to be in credit at this time of year, as you will need this to cover higher power costs over winter. 

Yet some suppliers are holding on to as much as £500, more than a third of the average annual bill, while also hiking monthly payments.

Joe Malinowski, founder of comparison site TheEnergyShop, says: ‘It wouldn’t surprise me if companies are hoarding as much cash as possible to survive.’

Rules enforced by watchdog Ofgem state that energy suppliers should refund credit in a ‘timely manner’ when it is ‘fair and reasonable to do so’. If firms refuse to refund customers, they must explain why.

But Frank and Gillian Jeynes say Outfox The Market has failed to provide a reasonable explanation for holding onto their £580.97 credit balance. 

Prices are rising for households due to the energy crisis with some saying bills are doubling

Prices are rising for households due to the energy crisis with some saying bills are doubling

The Leicester-based supplier told the couple it will only return £58.59 — just 10 per cent of the total. 

At the same time the firm is also increasing monthly direct debit payments from £160 to £260.

Frank, 80, who lives in a two-storey home in Great Comberton, Worcestershire with Gillian, 78, says that when he first asked for his money back a couple of weeks ago, staff had said he could withdraw his entire balance.

But the provider has since changed its mind and did not reply to his emails asking why.

In March, Ofgem proposed new rules to limit the amount of credit suppliers could retain amid concerns some were using customer cash to fund ‘otherwise unsustainable business practices’. New rules are unlikely to come into force until 2022.

Customers of London-based Bulb, which supplies 1.7million homes, say the firm is hiking direct debit payments by up to 80 per cent. 

Clive and Kerry May were told their direct debit payments were rising by 35 per cent from £139 a month to £188.73.

Bulb claimed their account was running low, but Clive found they were £454 in credit. Clive, who lives in Mold, Flintshire and runs a construction company with his wife, says: ‘It feels like Bulb is going to its customers with a begging bowl.’

Bulb has now adjusted Clive’s monthly payments to £169.86 and refunded £284.84 of his credit.

One 86-year-old Together Energy customer, who did not wish to be named, was told her monthly payments would rise from £72.74 to £167.02 if she switched to its cheapest fixed tariff.

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