A quarter of households face energy bill shock

Over a quarter of households face unexpected energy bill shocks by not supplying regular meter readings.
Over a quarter of households face unexpected energy bill shocks by not supplying regular meter readings.
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Over a quarter (26%) of households – equivalent to over seven million homes – face unexpected energy bill shock by not supplying regular meter readings, according to new analysis by uSwitch.com, the independent price comparison and switching service.

The data shows that nearly half (49%) of households suddenly find themselves in credit or debt to their energy supplier after submitting a meter reading after a period of receiving bills based on estimated energy use.

In cases where the estimates are too high, the average amount households are owed by suppliers is £137 – over ten per cent of the average annual energy bill. At the other end of the scale, where estimates end up being too low, consumers suddenly find themselves in debt to their supplier by an average of £125.

When a consumer receives a series of bills based on estimated usage, significant amounts of credit or debt can build up over time. In fact, five percent of households who ended up in debt after submitting a meter reading, and three percent of households who ended up in credit, found their account balance suddenly changed by a staggering £500 or more.

Although energy suppliers are required to read customers’ meters at least once a year, Ofgem advises consumers to submit their own readings quarterly to reduce the risk of inaccurate bills. Worryingly, a quarter (25%) of consumers said they weren’t aware that they should read their meters this frequently while over a fifth (21%) felt meter readings should be the sole responsibility of their supplier. In addition, less than half (48%) of all households submit readings after being prompted to by their supplier and nearly a fifth (16%) believe that sending in a reading won’t make any difference to their bill.

Smart meters will be offered to every home in Great Britain by 2020, putting an end to estimated bills which can leave consumers yo-yoing between credit and debt with energy providers. In fact, the research also revealed that two thirds (64%) would consider requesting a smart meter from their supplier to get accurate bills.

Claire Osborne, energy expert at uSwitch.com, says: “Reading meters may seem like a chore, but regularly doing so will help you keep a grip on your energy use and spend. If you haven’t submitted a reading for some time, estimated bills could be painting a very misleading picture and put you at risk of being in significant credit or debt with your supplier.

“Smart meters, once installed in every UK home by 2020, will end the curse of estimated bills but until then consumers should send their supplier a meter reading once a quarter.

“As we move into autumn it’s wise to keep your account in some credit, to help pay for heating during the colder winter months. It’s important that all consumers, particularly those who haven’t submitted a reading in the last three months, understand the true balance of their account and don’t let estimates lead to bill shock down the line.”

Claire Maugham, Director of Policy and Communications at Smart Energy GB, the voice of the smart meter rollout, says: “Smart meters will bring an end to estimated bills and provide accurate information about what we spend on gas and electricity in pounds and pence. They will help us to manage our energy use and mean we will no longer have to deal with the worry or the shock of an unknown bill. Sixty-nine per cent of people with smart meters said they feel more in control of their energy use and eight in ten would recommend them to others.”