Gas giants build cash float as customers feel the heat

Following a winter of historically high gas prices for UK households, research reveals gas suppliers have built up a staggering £490 million reservoir of customers’ unspent money.

That’s an average of £56 for each of the 8.7 million households currently in credit. And as gas prices finally begin to tumble, price comparison website moneysupermarket.com warns households to make sure their monthly direct debits follow suit, to avoid their provider sitting on an ever larger stockpile of their hard-earned cash.

Currently, six out of ten (61 per cent) customers pay their gas bill by monthly direct debit, and these have risen steeply to reflect higher domestic gas prices throughout last year. With British Gas this month kicking off a long overdue gas price war amongst UK suppliers, customers should now begin to see the benefits in terms of reduced bills. However, moneysupermarket.com is highlighting a standard time lag of up to six months for price changes being reflected in reduced direct debits, meaning increasing sums of customer money will languish in their gas suppliers’ coffers. Whilst in most cases, gas suppliers reassess their customers’ direct debits automatically every six months based on each individual customer’s start date, some suppliers do so only annually.

Paul Schofield, head of utilities at moneysupermarket.com, said: “Households have been taking the strain of higher gas prices for far too long, and with an energy price war finally gathering pace, it is vital customers reap the rewards as soon as possible. Six months is an unacceptable period of time to continue paying over-the-odds, but customers can take matters into their own hands by contacting their supplier and requesting an immediate direct debit review.”

The research shows that Powergen’s customers have the highest average amount of cash held on float (£78) and the highest percentage of customers in credit to over £100 (26 per cent compared to 12 per cent national average). Customers in the South West have the highest average amount of cash held on float (£68), and also have the highest percentage of customers in credit to more than £100 (24 per cent).

The survey also reveals that an astonishing 80 per cent of those who are in credit with their gas supplier have never asked for their cash back.

moneysupermarket.com will continue to monitor the overall cash held on float by UK gas suppliers and highlight where suppliers are taking too long to pass on lower direct debit charges. At the same time, the price comparison website recommends customers take action, approaching their gas supplier if their direct debit payments do not start to fall to request money back and a review of their payments.

Paul Schofield continued: “Six out of ten gas customers pay by direct debit and gas suppliers are going to continue to stockpile customers’ excess cash over the coming months. You only need ask yourself the simple question: who needs my money most?”

moneysupermarket.com is making a stand to help people ditch their expensive power companies and get the cheapest energy deal by offering £30 cash-back to all customers swapping to a dual fuel tariff through its service. Those not going for a dual fuel tariff but changing a provider or tariff will benefit from a single £17.50 payment.