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

Qyburn

https://forums.moneysavingexpert.com/discussion/comment/81879882#Comment_81879882

The bill in question, was day, night units, gas and over a period of changes to bill charges / tariffs etc. So not just three entries.

Did all three have mismatched readings, gas, electricity day and night? Essentially I think you're saying that for one bill they used an incorrect starting reading, which didn't match the end reading of the preceding bill. Presumably higher so that there was consumption that was not billed. And in some way the error was spread over several bills so you didn't notice the bill(s) being lower than expected by £400.

Qyburn

Of course if the op was on mvdd when £400 corrected - wouldn't they then have taken it all that month to zero balance ?

If he had been on MVDD he wouldn't have a balance for them to draw on, and back billing rules should have stopped them taking a new DD to settle it.

MWT

https://forums.moneysavingexpert.com/discussion/comment/81880199#Comment_81880199

Exactly, can't fix the past, but can stop it happening again …

For the record I still favour properly checking the bills in the first place rather than trying to avoid having to pay, but the MVDD route is there to be used if people really want to…

Tries_to_help

Re Matt Matt's comment

My relative has been on the "Priority register" with her provider for years.

Whilst I understand some people spend their lives checking every bill/ account/ payment in relation to these suppliers I am unsure why we should have to do so to this extent.

Smart meters are supposed to do this for us. in same way people who fit smart meters are supposed to fit them properly. It is not the responsibility of the customer to do this.

Chezzham_2's post this morning makes it clear she did everything to clarify her bills/readings and payments yet they still did not clarify what they had done - giving different reasons. No one would accept this kind of relationship with any other service.

" OH sorry I know you asked for a dress to have 22" waist and we made it 32" You still have to pay for the 32"!! and it will be 3 times the cost we quoted and you paid in advance".

Qyburn

" OH sorry I know you asked for a dress to have 22" waist and we made it 32" You still have to pay for the 32"!! and it will be 3 times the cost we quoted and you paid in advance".

A more exact analogy, although a stretch, would be "I ordered and paid for size 22, but actually decided to take a size 32 and don't want to pay the difference."

Your story seems to cclaim the supplier forced the customer to use more energy than they wanted. But you don't explain how you think a supplier could do that .. go round and switch stuff on against their will maybe?

gpman

https://forums.moneysavingexpert.com/discussion/6654634/back-billing-but-in-credit-so-energy-ombudsman-found-in-favour-of-supplier

First of all, my apologies since I admit I have not read this whole thread, and so apologise if this has already been mentioned.

The outcome you received from the EO would appear on the face of it most unfortunate. Did you, in your escalation to the EO, provide the EO with a copy of the latest Supplier Licence Conditions? (SLC).

The EO should be aware of these, but often only review a complaint based upon the evidence placed before them (by you and the supplier).

The SLC is quite clear on backbilling. e.g. for electricity, it is covered by Condition 21BA

(You should be able to find a similar condition relating to the supply of gas, where applicable)

For the sake of full transparency, there are some more sub-conditions, but I have not included them here as I do not think they apply to your case. (21BA.3 onwards)

So in short, and subject to the exemptions allowed for, the supplier is prohibited from producing a bill that relates to consumption more than 12 months earlier i.e. nothing to do with your account being in credit.

If you had provided the EO with a copy, or otherwise referred them to this specific condition of the applicable SLC, what was the reason the EO gave for coming to the conclusion you say they did.

MWT

https://forums.moneysavingexpert.com/discussion/comment/81882716#Comment_81882716

It is not considered to be a 'charge recovery action' when the customer has already made payments to the supplier, and those payments have resulted in a sufficient balance to cover the costs of the energy they have used outside the last 12 months.

This is why the Ombudsman rules as they have (many times) on this issue…

gpman

https://forums.moneysavingexpert.com/discussion/comment/81882750#Comment_81882750

Thanks, but I did not refer to the 'charge recovery action'; that is an "or" not an "and" condition.

Or are you are suggesting the supplier deducted money from the customers account without producing any bill in support of such deduction?

NewbyForthwith

https://forums.moneysavingexpert.com/discussion/comment/81882750#Comment_81882750

I don’t agree with this interpretation.

Ofgem really need to clarify and document exactly what the criteria are and are not to prevent these significant grey areas where what is documented does not match how it is being interpreted differently by suppliers and Ombudsman vs consumers. Does anyone on here have a route in to Offem and or government teams responsible for energy licensing to get this in black and white for the benefit of all parties?

As it stands today, the best documentation available to support how the back billing license conditions should be handled is the The Ofgem open letter to suppliers sent in December 2020 (“Expectations for energy suppliers who are dealing with domestic and microbusiness consumers when undertaking charge recovery action”) It clearly states that sending a bill counts as a charge recovery action:

“The issuance of a bill seeking the recovery of previously unbilled consumption is referred to as ‘charge recovery action’ ”

It also makes clear all payment methods are in scope:
“The Backbilling Requirements apply to all payment methods, regardless of the payment type, meter mode or meter arrangements. The 12-month backbilling limit applies in all cases where a supplier is seeking to recover charges for unbilled consumption that is over 12 months old”

My read of the OPs thread is that they absolutely meet the criteria of back billing and should be protected by the Ombudsman. I am very shocked and saddened that in this case the Ombudsman appears to be failing in its duties to fairly find in favour of consumer protection and failing to hold Octopus to account for their license conditions.

“ALL payment methods” and “ALL cases” are critical words here - they make no allowance for exceptions. If Ofgem do have exceptions that are intended to be out of scope they need to critically review how the above statement is worded as consumers clearly are interpreting this one way and suppliers are interpreting it in another to their own benefit.

I should also add that contrary to some previous comments that the letter also makes clear that the onus on correctly billing sits with suppliers and consumers are not expected to identify errors the supplier has made (unless a consumer is obstructing a supplier from doing so)

“Ultimately, it is the responsibility of suppliers to bill consumers correctly for their usage and to ensure consumer accounts are correctly reconciled. Consumers must not be held responsible for failing to identify errors in their billing or that a debt balance is accruing.”

So whilst a review of bills is advisable it is absolutely not the OPs fault for failing to identify Octopus’s error at the time. Please be kind!

MWT

Everyone is free to disagree as much as they want, but the Ombudsman consistently (with a very low number of distensions) rules that the funds previous paid to a supplier are available to be used for what would otherwise be considered to be 'back-billing'.

The aim of this rule is not to prevent suppliers from getting paid when there is a previous mistake/failure to bill.

It is there to prevent bill-shock, and no matter how shocking it may feel to get a bill for a period you thought was already paid, it is only considered to be bill-shock if it is not already covered by payments you have made.

The ordinary rules for invoicing only limit the period to 6 years, Ofgem tightened that up to only 12 months, which puts a lot of pressure on suppliers already, going a step further to prevent use of existing balances as well feels like a step too far…