Utilities drag feet over bill refunds

Thousands of people are waiting months, sometimes years, for refunds from overpayments on gas and electricity bills, according to industry watchdog Energywatch.

In some cases the amounts owed can be worth more than a customer's annual energy bill.

A report by Energywatch, to be published tomorrow, says that the problems arise when customers continually overpay on their monthly direct debits, or when a final bill shows a credit. When customers ask for a refund, suppliers appear to be on a 'go-slow'.

Energywatch has fought for cash returns for more than 6,000 people who were getting nowhere with their appeals to suppliers.

Energywatch says that the average amount owed was the equivalent of an annual average energy bill, about £350. In some cases the money has been owed for years.

In one case a man in Cambridge, owed £800 by Npower, chased them for the money for two years. A man in Bournemouth had been paying bills sent to him by Powergen for two years before he discovered he was not even a customer. It was not until after Energywatch intervened that he recovered just under £580 owed, and a goodwill payment of £25. A woman in Nottinghamshire contacted British Gas Trading in February 2002 to ask for a £720 credit on her account, but did not get the money until September after Energywatch got involved.

Ann Robinson, chair of Energywatch, says:

This is the worst kind of double standard. If the boot was on the other foot, energy consumers would soon be receiving letters threatening disconnection or court action.

'Yet thousands of consumers who have paid for their energy in advance and are merely asking for what they are owed are coming up against a brick wall.'

Energywatch believes the true figures may be much worse than its estimates and that some householders will be in debt as a result of the payments owed to them.

Robinson says: 'These are cases of incompetence combined with arrogance and consumers are being placed under enormous pressure. This is quite unacceptable.

'The answer is simple. When a supplier identifies a credit it should be refunded immediately or if appropriate they should begin discussions to reduce a monthly direct debit payment. If there is any delay in the repayment, interest should automatically be added to the sum owed.'