Why aren’t my energy bills going down? 

Mouthy Money Your Questions Answered panelist, Martyn James, answers a reader’s question on why their energy bills aren’t coming down now the price cap has been lowered. 

Q My energy provider contacted me recently to say we should adjust our direct debit because we are using more energy and this was putting our energy bills in arrears. But I’ve just seen that the price cap has come down again so shouldn’t my bills come down too?   

A In recent years some energy companies have exploited direct debits so outrageously, that there are calls to reform the entire system.

Your provider might be suggesting you should change your direct debit, but in practice they are saying they will… unless you object. 

The problem with direct debits is that they allow businesses to change the amount of money you pay and when you pay it.  

According to the Direct Debit Guarantee, the business has to give you at least 10 working days notification of any changes it wants to make, but this is often done by email, which means most people don’t notice until it’s too late.

It would be very easy to send a few texts instead which would at least warn people about the size of their energy bills, but strangely, there’s a total lack of interest in doing so from most energy businesses. 

But I digress. The number one question that people ask me about energy bills at the moment is: why are my bills going up when the prices are coming down? 

The reasons for this are complicated, but might include one or a combination of the following factors: 

1. Your meter is giving faulty readings. 

2. You’ve significantly changed your energy consumption. 

3. Your actual energy usage has been disguised by credit you’ve built up on your account reducing your bill over winter. 

4. Your current energy agreement has ended and you’ve ‘defaulted’ on to a standard tariff, 

5. The business has been relying on estimated readings, but now they have an actual reading, they have ‘back billed’ you for your actual energy consumption. 

6. There has been a billing error. 

That’s quite a lot to contend with, but ultimately, it’s for your energy provider to establish what’s going wrong with your bill, but there are a few things you can do too. 

Energy bills are ridiculously complicated, so it’s hard to know if they are right or not. But here are a few pointers. 

The cost of your bill will have increased over the last two years because of the crisis in the energy wholesale market. But what you need to look for is an increase in the units of energy you use. This is especially important if you haven’t been using more energy.

Ask our experts your money questions

Start by going through your last two years of bills. Work out roughly how much you’re using on average for each billing period. If there’s been an inexplicable increase, you have a valid complaint. 

You can also ask your energy provider to clarify in plain English why things have changed. Ask them things like; why your energy usage is higher, if they are relying on estimated readings, if they are billing you for energy used over a year ago and if you’re on the cheapest tariff. 

If your energy company sends you a new bill that covers a period older than 12 months, they should not be charging you for it. This is known as ‘back billing’ and is explicitly forbidden by regulator Ofgem.  

However, if you have an existing debt that you were correctly billed for at the time, the energy firm can pursue it for up to six years.   

If you have a smart meter, it’s estimated that just under four million of them aren’t working properly. Smart meter problems are the second biggest area of complaints after billing disputes. Problems can arise from technical problems with the meter or the data not being transmitted correctly. 

To resolve the problem you will usually be asked to take meter readings every day for around a week to assess the problem. I’d recommend photographing your meter readings so you can prove they are correct. 

The energy firm is obliged to identify and correct the situation with the meter. This could involve sending out an engineer to assess the meter’s performance.   

Energy businesses are obliged to address all complaints in writing unless you agree otherwise. Their ‘final response’ should set out what they’ve done to resolve your complaint and any compensation that they might be offering. This should also tell you about your right to go to the Energy Ombudsman. 

Martyn James is a leading consumer rights campaigner, TV and radio broadcaster and journalist. https://martynjamesexpert.co.uk/articles/ 

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