Energy industry worst for inaccurate bills

Consumers have ranked energy suppliers last when it comes to providing accurate bills according to new research from uSwitch.com, the independent switching and price comparison service.

The industry was voted worst for inaccuracy out of ten well-known and used industries – even falling behind traditional bureaucratic bunglers such as council tax departments and the Inland Revenue:

The uSwitch.com research reveals that a third (33%) of all energy customers have been inaccurately billed in the last two years. Consumer confidence in the ability of suppliers to get bills right may also be suffering, as over one in five (21%) customers rate their energy bills as inaccurate or very inaccurate.

The results reflect the true impact on consumers when energy companies consistently get things wrong. On average it takes just over two months for a billing inaccuracy to be resolved to the customer’s satisfaction. For over a quarter of consumers (28%) it has taken between a week to a month to get the issue resolved with their supplier, while for 18% it has taken between one to six months to sort out. However, 15% of consumers say that their complaints either took longer than six months or are yet to be resolved.

In October 2005 the British Standards Institute launched a proposal to “end an era of erroneous bills in the UK” so that the UK could “wake up from its billing nightmare”. The British standard is voluntary rather than compulsory and these findings, along with energywatch complaint statistics, suggest that the industry still has a long way to go. In April this year, energywatch reported that British Gas had the highest number of complaints amongst energy providers in the UK - seven in ten complaints were made about the energy giant with 72% directly related to billing.

Suppliers are however delivering on their promise to provide regular meter readings – 66% of consumers have had their meter read by their supplier within the last six months. However, 42% - more than 10.4 million consumers - report that they unexpectedly owed money to their supplier after a meter reading. On average they owed £134 each, or £1.4billion collectively, which suggests that the industry faces a separate issue over the accuracy of estimated bills.

Ann Robinson, Director of Consumer Policy at uSwitch.com comments: “This is not about individual suppliers letting the side down – this is a wake-up-call for the entire energy industry which has been compared with others and found to be sorely lacking. Despite well publicised changes to billing systems and promises to put their house in order, suppliers continue to let their customers down - no other industry operates such a hit and miss approach to accuracy.

“The introduction of smart metering will resolve the issue of estimated meter readings but, until the Government commits to supporting a national roll-out, both consumers and suppliers alike have a role to play in improving accuracy. Customers can help themselves by providing meter readings to their suppliers on a quarterly, if not more frequent, basis. This, coupled with suppliers’ own regular readings, should hopefully help tackle the major discrepancies between estimated and actual bills, which we believe are the root cause of the industry’s poor track record for accuracy.

“Suppliers should also alert their customers to the hidden danger of estimated charges – a financial health warning on estimated bills would be one way of achieving this while an annual energy statement would provide customers with an excellent means of assessing their overall usage and costs.

“Consumers should also be aware that if they end up owing more than £100 there could be a danger that their energy supplier refuses to let them switch to another. With our research showing that over 10.4 million consumers have unexpectedly received bills of £100 or more, it’s vital that consumers take a more active role in controlling their energy budget. Any action taken now would be particularly valuable as consumers will lose a vital safety net next year when energywatch closes its doors.”

Inaccuracy - how the energy industry compares:

Ranking - The most inaccurate*
1 Energy suppliers (gas and/or electricity)
2 Inland Revenue
3 Council Tax departments
4 Communication providers (broadband, home phone, digital TV)
5 Water companies
6 Mobile phone companies
7 Banks/Building Societies (current account statements)
8 Credit card/store card providers
9 Mortgage companies
10 DVLA (road tax)

*Based on the total number of people who rated their bills as inaccurate or very inaccurate.

Top five billing improvements that customers want to see:

1 Details of when a meter was last read and when it will be read next (42%)

2 Showing price against usage in a transparent way (42%)

3 Clearer layout/ reducing a lot of the current content (40%)

4 Information on price variations and when they come into effect (37%)

5 Differentiating between estimated and accurate bills (35%)