Money Wellness
Image of a man holding an energy bill. How to claim back energy overpayments and what to do if you're in debt to your energy provider
category iconbills
calendar icon29 Apr 2024

A tale of two halves – the energy haves and have nots

Energy suppliers are sitting on £3 billion of overpayments, according to Uswitch.com.

Data from the comparison and switching service reveals that 16 million households are owed refunds of around £210 on average.

With one in seven (14%) having balances of more than £300 with their energy suppliers. And a further 5% building up more than £500.

Two in five households (44%) with credit say their balance built up over winter because their direct debt was set too high. And two fifths (40%) put it down to their efforts to reduce energy usage, with a third (33%) saying they used their heating less often due to the mild winter.

Households usually exit winter with little or no credit, having used up what they have during the colder winter months. Most rebuild their credit levels during the spring and summer months when energy usage is generally lower.

Despite £3.4 billion worth of refunds being owed, energy credit this spring is much lower than the year before. This is due to energy bills being higher than the previous winter when households received £400 of government support towards energy price hikes.

In stark contrast, the data also reveals that millions of households are in debt to their providers. Nearly four million owe their energy provider £194 on average, with £771 million collectively outstanding.

The average debt per household has decreased slightly from £234 last year, although the amount of households in debt has risen by 167,000.

Octopus Energy has the most customers struggling with debt. But British Gas has the highest level of customer debt, with each owing £247 on average. Although it also has the joint-lowest percentage of customers in debt.

Why do some households choose to keep their energy account in credit?

In recent years, households have been advised to keep some credit in their account to help pay for energy bills that have continued to remain high over spring and summer.

Bills are now falling, with the energy price cap reducing by 12% in April, and a further fall predicted in July.

Households are therefore being advised to check their account and consider reclaiming any excess amounts of credit that amount to over two months’ worth of payments.

How do you reclaim energy overpayments?

Contact your supplier. You are entitled to a refund at any time. Suppliers must return your money unless they have reasonable grounds not to.

According to Uswitch.com, four in five households (79%) who requested a refund received it within four weeks of claiming.

But a word of warning – before claiming back any money owed, you need to think about whether you’ll struggle to pay your bills without a credit balance in the future.

What should I do if I’m in debt to my energy provider?

If you’ve built up debt with your energy provider, you should contact them to discuss how you will repay them.

Your supplier will work with you to agree a payment plan that is affordable to you.

Under Ofgem rules, you can ask for:

  • A review of your payments and debt repayments
  • A payment break or reductions
  • More time to pay
  • Access to hardship funds
  • Advice on how to use less energy

What other financial support is available if I’m in debt to my energy provider?

Most energy companies offer schemes or grants to help. Speak to your provider to see how they can support you.  

You might also be entitled to support from the government or your local authority, such as:

  • Winter fuel payment
  • Cold weather payment
  • Warm home discount

And may be able to repay the debt directly from your benefit payments under the first direct scheme.

There are also several charities offering hardship support to those struggling with energy bills. Turn2Us has a grant search tool that can find the most appropriate support for you. Or you could use our free benefit calculator to make sure you’re claiming all the support you’re entitled to.

Can you get debt advice for energy debt?

If there is no prospect of you repaying what you owe to your energy provider, or your energy debt is one of several you’re juggling, you should seek free debt support.

Electricity and gas debt are priority debts. You could face serious consequences if you fail to pay your energy bills. E.g., your supplier could cut off your supply or your debt could be passed onto a debt recovery firm.

Avatar of Caroline Chell

Caroline Chell

Caroline has worked in financial communications for more than 10 years, writing content on subjects such as pensions, mortgages, loans and credit cards, as well as stockbroking and investment advice.

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