Back billing - but in credit so Energy Ombudsman found in favour of supplier

chezzam_2

Can anyone help with this please?

We had a bill shock in September 2025 when our energy supplier sent us our statement and had taken an extra £400 for energy used in March 2023 that they had not charged us for through their own error. (We had provided meter readings).

Over the years we had maintained the suggested direct debit payments and increased them when told to do so.

As a result we had built-up just enough credit to cover the backbiling amount. Please note that this corresponds exactly with the time of year, when we needed the credit to see us through the higher usage over winter.

As a result of the £400 debit, the supplier has told us we now need to increase our direct debit to pay for our energy usage going forward for an unknown period of time as we no longer have sufficient funds.

The energy ombudsman has basically told us, ordinarily this would be back billing but as we have credit, the supplier is allowed to take this, but no where in the regulations can i see this clause.

This is absolutely perverse, if this is correct it goes against every recommendation to build up a credit to cover winter months.

If correct it gives the supplier free reign to wait indefinitely till a customer is in sufficient credit to backbill.

Is this really protecting the consumer fairly.

How can this possibly be fair?

Is this seriously legal and correct?

Ectophile

That's the way the backbilling rule is worded. They aren't allowed to demand more money for any bill over a year old. But if you have already paid them enough money, then they can keep it.

Without that rule, only the Limitation Act would apply. That would give them 6 years to claim back money owed (5 in Scotland).

Swipe

Another reason to pay your monthly DD amount into a savings account and go with variable direct debit instead if the supplier allows it.

QrizB

Welcome back to the forum after all these years!

Is this seriously legal and correct?

Yes, this is how it's meant to work. Despite the delayed billing, your supplier has kept your DD at the right level and your account credit covered your liabilities.

There was a long discussion of the back billing rules and how they're implemented recently; see this thread:

https://forums.moneysavingexpert.com/discussion/6652899/eon-next-back-billing-issue

chezzam_2

https://forums.moneysavingexpert.com/discussion/comment/81877813#Comment_81877813

Thank you for your comment. To clarify, in 2023, they didn't use our closing meter reading for the opening meter reading for the next period (1 day later), so we were never been billed for those units because they used the wrong opening read. We only got billed for those units in September 2025. Is it your understanding that they can still debit the amount from our credit even though they only billed us for them 2.5 years on.

chezzam_2

https://forums.moneysavingexpert.com/discussion/comment/81877888#Comment_81877888

If that's the case, it seems very tactical of the energy supplier, to increase our direct debit, to build up a credit to the amount that they need to back bill, for energy 2.5 years ago, due to their error. This feels like a shocking legal loophole that suppliers are obviously aware of and seems to make a mockery of the regulations.

chezzam_2

https://forums.moneysavingexpert.com/discussion/comment/81877817#Comment_81877817

100% will be doing this going forward and telling everyone of our experience, but think ofgem needs to close the loophole.

PostHoc25

Hi chezzam_2

So sorry you experienced that shock. Never good, regardless of the situation.

I only switched to DD last year after making ad hoc payments to Octopus which I adjusted based on my readings. Of course before going onto DD, I wasn't on the best unit rates. If it feels like more of a principal issue at this point, (I would definitely feel the same, legal or not), then do some maths and see how much more it might cost to just pay as and when into your energy account to cover the actual bills.

I was with Pure Planet and Shell prior to Octopus and they both caused me huge issues when I was on DD, leaving me feeling like I had zero control because they would change amounts on me every couple of months.

Paying a little more on my bill but having more control made me feel a lot better in the long run.

Octopus messaged me to reduce my DD last week but I have left it as it is because for the last 5 years, April has been my highest bill 😉

chezzam_2

To emphasise - we were not billed for the energy in 2023 due to Octopus' mistake. The first time we were billed for the usage in 2023 was in September 2025 by way of a statement.

The following is what I believe, applies to our situation. I welcome any further comments as we only have one more day to accept or decline the ombudsman decision.

Under SLC 21BA and Ofgem guidance, the back-billing prohibition applies regardless of account credit. Because the first bill for our 2023 consumption was not issued until 2025, the supplier cannot recover those charges — including by offsetting them against money already held in our account.

MattMattMattUK

https://forums.moneysavingexpert.com/discussion/comment/81877902#Comment_81877902

Yes they can.

https://forums.moneysavingexpert.com/discussion/comment/81877909#Comment_81877909

You are ascribing a level of competence and planning beyond what many are capable of. If they were competent enough to plan and execute that plan they would be competent enough to bill correctly in the first place.

https://forums.moneysavingexpert.com/discussion/comment/81877912#Comment_81877912

It is not a loophole, it is deliberately designed that way. The purpose was/is to prevent "bill shock" where the customer gets a large bill they are unable to pay, if the money is already in the account then the consumer does face that. In any other business they have six years to recover the unpaid bill so this system is already of considerable benefit to consumers.

https://forums.moneysavingexpert.com/discussion/comment/81877935#Comment_81877935

Unfortunately what you believe is not correct, as has already been explained above.

noitsnotme

https://forums.moneysavingexpert.com/discussion/comment/81877935#Comment_81877935

If you’ve been given a final decision by the ombudsman, declining it usually makes no difference, it’s still the end of the road with them. All you can do after that is take your chances through small claims court.