Your browser isn't supported
It looks like you're using an old web browser. To get the most out of the site and to ensure guides display correctly, we suggest upgrading your browser now. Download the latest:

Welcome to the MSE Forums

We're home to a fantastic community of MoneySavers but anyone can post. Please exercise caution & report spam, illegal, offensive or libellous posts/messages: click "report" or email forumteam@.

Search
  • FIRST POST
    • theJBP
    • By theJBP 17th May 19, 9:47 AM
    • 5Posts
    • 2Thanks
    theJBP
    Debt on energy account
    • #1
    • 17th May 19, 9:47 AM
    Debt on energy account 17th May 19 at 9:47 AM
    Hi all

    I'm with Lumo for gas and electric and have a smart meter with them. I pay my bills by direct debit. I recently tried to switch energy supplier to save money and was informed that the switch had been stopped due to an accumulated debt of over £500!!!

    This is the second time this has happened, a while back I was with Economy Energy and when I came to switch was informed I had a debt, despite providing regular meter readings.

    Just what is the point in providing an energy company with meter readings if not so that they can adjust how's much you're paying so that you pay your bills? Is this not the point of a smart meter, to make this process even easier and pain free?

    Some people will say I only have myself to blame, that I should have checked how much energy I was using against how much I was paying, to ensure they were taking the correct amount, and I accept this to a point. But really I resent having to do their bloody job for them. Energy bills are high enough as it is, so they should be doing this job.

    Is there anything I can do about this? Is it worth making a complaint to the ombudsmen? Any advice would be gratefully received.
Page 1
    • Takmon
    • By Takmon 17th May 19, 11:36 AM
    • 586 Posts
    • 557 Thanks
    Takmon
    • #2
    • 17th May 19, 11:36 AM
    • #2
    • 17th May 19, 11:36 AM
    Hi all

    I'm with Lumo for gas and electric and have a smart meter with them. I pay my bills by direct debit. I recently tried to switch energy supplier to save money and was informed that the switch had been stopped due to an accumulated debt of over £500!!!

    This is the second time this has happened, a while back I was with Economy Energy and when I came to switch was informed I had a debt, despite providing regular meter readings.

    Just what is the point in providing an energy company with meter readings if not so that they can adjust how's much you're paying so that you pay your bills? Is this not the point of a smart meter, to make this process even easier and pain free?

    Some people will say I only have myself to blame, that I should have checked how much energy I was using against how much I was paying, to ensure they were taking the correct amount, and I accept this to a point. But really I resent having to do their bloody job for them. Energy bills are high enough as it is, so they should be doing this job.

    Is there anything I can do about this? Is it worth making a complaint to the ombudsmen? Any advice would be gratefully received.
    Originally posted by theJBP
    I don't see the point in a complaint because it's energy you have used so you have to pay for it eventually.

    Personally i prefer to underpay on my direct debit for my energy because the money is better in my bank rather than building up a credit and it being in theirs. But i do keep an eye on my usage so i know if i'm underpaying or not.

    It's a bit poor of them to allow this to happen because it opens them up to difficulties in recovering money they are owed if people refuse to pay.

    But you say it has happened before so if you decided to not keep an eye on it in the future you can't have been too worried about it happening again.
    • theJBP
    • By theJBP 17th May 19, 11:49 AM
    • 5 Posts
    • 2 Thanks
    theJBP
    • #3
    • 17th May 19, 11:49 AM
    • #3
    • 17th May 19, 11:49 AM
    Hi Takmon

    You're right of course, I have been a little slack. But to be honest when it happened before I was providing meter readings myself and the company was Economy Energy which went out of business. Online I had seen they weren't the most popular company and so assumed (yes, I know, never assume anything) that they had just screwed up.

    With the new company I was given a smart meter and was assured that this meant I could just sit back and do nothing, everything would be taken care of. Again, an assumption, I know. Obviously, now I will keep an eye on it going forward, but giving vent I just don't see why it is so hard to adjust the amount they take each time so that I'm paying for what I'm using. Why do I have to be in credit or debit? Why can't they just take for what I've used? It really shouldn't be that effing hard.
    • falcieri
    • By falcieri 17th May 19, 1:46 PM
    • 113 Posts
    • 61 Thanks
    falcieri
    • #4
    • 17th May 19, 1:46 PM
    • #4
    • 17th May 19, 1:46 PM
    I don't see the point in a complaint because it's energy you have used so you have to pay for it eventually.

    Personally i prefer to underpay on my direct debit for my energy because the money is better in my bank rather than building up a credit and it being in theirs. But i do keep an eye on my usage so i know if i'm underpaying or not.

    It's a bit poor of them to allow this to happen because it opens them up to difficulties in recovering money they are owed if people refuse to pay.

    But you say it has happened before so if you decided to not keep an eye on it in the future you can't have been too worried about it happening again.
    Originally posted by Takmon

    If my experience is anything to go by then Economy Energy's metre reading system was completely broken so I wouldn't blame a customer in this respect. I don't think they were capable of registering readings correctly.



    It is a problem with some energy companies. I am with Bulb and have complete control over my monthly DD amounts and how much is in my account and they don't seem to have a problem with registering metre readings correctly. I thought about getting a smart metre but heard so many bad things I decided to stick to the old fashioned method and use an excel spreadsheet and the theromostat to predict my bills.
    • Consumerist
    • By Consumerist 17th May 19, 9:02 PM
    • 5,222 Posts
    • 2,609 Thanks
    Consumerist
    • #5
    • 17th May 19, 9:02 PM
    • #5
    • 17th May 19, 9:02 PM
    Hi all

    I'm with Lumo for gas and electric and have a smart meter with them. I pay my bills by direct debit. I recently tried to switch energy supplier to save money and was informed that the switch had been stopped due to an accumulated debt of over £500!!!
    . . .
    Is there anything I can do about this? Is it worth making a complaint to the ombudsmen? Any advice would be gratefully received.
    Originally posted by theJBP
    Well, yes you can complain to the ombudsman because, if you are paying by direct debit, a debit balance on your account is NOT a debt as defined by the suppliers Standard Licence Conditions.

    You will need to start the suppliers formal complaints procedure because they have wrongly objected to your transfer.

    If you are unable to settle the debt within 30 days then you will need to set up a payment plan to pay it off as soon as possible but it seems to me, from what you have said, that some of the blame. at least, lies with the supplier and the ombudsman may offer you compensation or may even compel the supplier to withdraw the objection.
    Warning: In the kingdom of the blind, the one-eyed man is king.
    • B13blues
    • By B13blues 18th May 19, 12:19 PM
    • 73 Posts
    • 15 Thanks
    B13blues
    • #6
    • 18th May 19, 12:19 PM
    • #6
    • 18th May 19, 12:19 PM
    Sure these energy companies aim to get debts on peoples accounts so they can't switch/leave.
    • The Fat Controller
    • By The Fat Controller 18th May 19, 2:41 PM
    • 115 Posts
    • 66 Thanks
    The Fat Controller
    • #7
    • 18th May 19, 2:41 PM
    • #7
    • 18th May 19, 2:41 PM
    Sure these energy companies aim to get debts on peoples accounts so they can't switch/leave.
    Originally posted by B13blues
    Why would any company want a customer to OWE them money ?

    Not great for their cashflow if they have supplied you with something but you still haven't paid for it.

    Another example of a customer not actually keeping up with the status of their account and actual usage.
    • B13blues
    • By B13blues 19th May 19, 2:13 PM
    • 73 Posts
    • 15 Thanks
    B13blues
    • #8
    • 19th May 19, 2:13 PM
    • #8
    • 19th May 19, 2:13 PM
    Because they know they'll get their money even if it goes to a debt collection agency.
    • Consumerist
    • By Consumerist 20th May 19, 10:18 AM
    • 5,222 Posts
    • 2,609 Thanks
    Consumerist
    • #9
    • 20th May 19, 10:18 AM
    • #9
    • 20th May 19, 10:18 AM
    . . . Another example of a customer not actually keeping up with the status of their account and actual usage.
    Originally posted by The Fat Controller
    Whilst I accept your sentiment in principle, it is probably representative of a significant majority of energy customers.

    The energy suppliers, however, are "persuading" customers to have smart meters installed in order to meet their Ofgem targets, using empty promises (hype) of customers not needing to do anything and that their bills and DDs will be automatically correct according to their energy usage.

    In my opinion, a smart meter being monitored by a dumb supplier is worse than a dumb meter. Suppliers should be held accountable.
    Last edited by Consumerist; 20-05-2019 at 10:27 AM.
    Warning: In the kingdom of the blind, the one-eyed man is king.
    • antrobus
    • By antrobus 20th May 19, 12:11 PM
    • 16,693 Posts
    • 23,632 Thanks
    antrobus
    Well, yes you can complain to the ombudsman because, if you are paying by direct debit, a debit balance on your account is NOT a debt as defined by the suppliers Standard Licence Conditions.....
    Originally posted by Consumerist
    Perhaps you can show us exactly were this definition is specified;

    https://epr.ofgem.gov.uk/Content/Documents/Electricity%20Supply%20Standard%20Licence%20Condit ions%20Consolidated%20-%20Current%20Version.pdf


    ....
    If you are unable to settle the debt within 30 days then you will need to set up a payment plan to pay it off as soon as possible ...
    Originally posted by Consumerist
    Hang on a minute! You've just told us that the balance is not a debt, now you are saying that it is a debt. Make up your mind.
    • Yellow_mango
    • By Yellow_mango 20th May 19, 12:21 PM
    • 173 Posts
    • 227 Thanks
    Yellow_mango
    I don’t know whether other suppliers offer this, but I am with First Utility (now Shell), with a smart meter, and was given the option to pay monthly based on actual usage, rather than a direct debit payment plan.

    Whilst it does not have the “benefit” of smoothing payments over the year, I much prefer this option. I like to know exactly where I am and to pay for what I use when I use it.
    • Consumerist
    • By Consumerist 20th May 19, 12:25 PM
    • 5,222 Posts
    • 2,609 Thanks
    Consumerist
    Perhaps you can show us exactly were this definition is specified;

    https://epr.ofgem.gov.uk/Content/Documents/Electricity%20Supply%20Standard%20Licence%20Condit ions%20Consolidated%20-%20Current%20Version.pdf

    Hang on a minute! You've just told us that the balance is not a debt, now you are saying that it is a debt. Make up your mind.
    Originally posted by antrobus
    See section [2.1 Oops !] 1.2 - Definitions:-

    Outstanding Charges
    means the amount of any Charges for the Supply of Gas [Electricity] which are due to the licensee from a Domestic Customer, have been demanded of that Domestic Customer by the licensee in Writing at least 28 days previously and remain unpaid;
    If you settle the debt within 30 days then the supplier must withdraw the objection to the transfer. Or you can wait while you go through the supplier's complaints procedure and then for the ombudsman to make a decision and then for the supplier to comply. The choice is yours. The complaint about the previous supplier can always be made after you have transferred to another supplier.

    Edit
    A statement of account is not a written demand for payment when paying by DD. Is it ?
    Last edited by Consumerist; 20-05-2019 at 12:41 PM.
    Warning: In the kingdom of the blind, the one-eyed man is king.
    • antrobus
    • By antrobus 20th May 19, 9:45 PM
    • 16,693 Posts
    • 23,632 Thanks
    antrobus
    See section [2.1 Oops !] 1.2 - Definitions:-

    Outstanding Charges
    means the amount of any Charges for the Supply of Gas [Electricity] which are due to the licensee from a Domestic Customer, have been demanded of that Domestic Customer by the licensee in Writing at least 28 days previously and remain unpaid
    ;

    ...
    Originally posted by Consumerist
    Oh, I see.

    You should have read beyond the definitions and actually read the license conditions, Specifically, page 95;

    Domestic Customer transfer blocking

    14.4 The licensee may ask or allow the Relevant Gas Shipper to prevent a Proposed Supplier Transfer in relation to a Domestic Customer at a Domestic Premises at which the licensee is the Relevant Gas Supplier in any of the following circumstances:

    (a) subject to paragraphs 14.5 and 14.7, if at the time the request is made Outstanding Charges are due to the licensee from that Domestic Customer;


    Paragraph 14.5 relates to prepayment meters and 14.7 to disputed amounts. I don't think they are relevant.

    Since condition 14.6 states that

    The licensee shall ensure that Outstanding Charges of amounts equal to or less than £500 are capable of being assigned by the licensee to a new Gas Supplier in accordance with the Protocol.

    and the OP has told us they had an 'accumulated debt of over £500!!!', this would appear to be a perfectly valid objection.

    Any complaint would be a waste of time, and the OP should do the blinkin obvious and pay off the debt if they still want to transfer.
    • antrobus
    • By antrobus 20th May 19, 9:50 PM
    • 16,693 Posts
    • 23,632 Thanks
    antrobus
    Hi all

    I'm with Lumo for gas and electric and have a smart meter with them. I pay my bills by direct debit. I recently tried to switch energy supplier to save money and was informed that the switch had been stopped due to an accumulated debt of over £500!!!

    ....
    Originally posted by theJBP
    Well Lumo say that;

    We constantly review your monthly direct debit payment amount. Whenever you come to our app, we check that what you’re paying is enough to cover what your expected annual usage is, for the next 12 months.

    https://lumoapp.co.uk/billing-and-payments/how-direct-debits-are-reviewed/

    Presumably if you don't go the app, nothing happens?
    • Consumerist
    • By Consumerist 21st May 19, 5:14 AM
    • 5,222 Posts
    • 2,609 Thanks
    Consumerist
    Oh, I see. . .
    Originally posted by antrobus
    Well, you may see it but it's clear that you just don't understand it. I hope I can make it clearer for you.

    14.4 The licensee may make a request in accordance with the Master Registration Agreement to prevent a Proposed Supplier Transfer in relation to a Domestic Customer at a Domestic Premises at which the licensee is the Relevant Electricity Supplier in any of the following circumstances:
    (a) subject to paragraphs 14.5 and 14.7, if at the time the request is made Outstanding Charges are due to the licensee from that Domestic Customer;


    SLC 14.4(a) and the definition of "Outstanding Charges" quoted earlier (SLC 1.2) is all the OP needs to make a complaint that the switch request was wrongly objected to.

    The OP was clearly not on any repayment plan with the supplier and had no demand for payment of outstanding charges at the time of the request.

    Incidentally, SLC 14.6 applies only to the transfer of debt for customers on prepayment meters which is entirely irrelevant in this case.
    Last edited by Consumerist; 21-05-2019 at 5:19 AM.
    Warning: In the kingdom of the blind, the one-eyed man is king.
    • antrobus
    • By antrobus 21st May 19, 4:41 PM
    • 16,693 Posts
    • 23,632 Thanks
    antrobus
    Well, you may see it but it's clear that you just don't understand it. I hope I can make it clearer for you.
    Originally posted by Consumerist
    No, I'm afraid it is you that doesn't understand. Outstanding charges is simply the balance on the account. If the supplier has issued a bill, and Lumo do them monthly, then they have 'demanded' the charges on that bill. There is no requirement for them to specifically request repayment of any debt within any particular time frame,

    The simple fact of the matter is that a supplier can object to a transfer if the balance due on the account is greater than £500, Because that's what condition 14.4 says.

    Therefore my advice to the OP would be, forget about wasting your time with a complaint, send Lumo a cheque for £500 or whatever, and re-request a transfer.
    • Consumerist
    • By Consumerist 21st May 19, 6:08 PM
    • 5,222 Posts
    • 2,609 Thanks
    Consumerist
    No, I'm afraid it is you that doesn't understand. . .
    Originally posted by antrobus
    Well, we will just have to agree to a difference of opinion.

    The OP has a case for complaint and has nothing to lose by taking the mater to the ombudsman in due course.

    I suspect your angle in this is to attempt - for reasons best known to yourself - to discourage energy customers from complaining about incompetent energy suppliers so the latter can continue taking advantage of their customers without being held accountable.
    Warning: In the kingdom of the blind, the one-eyed man is king.
    • theJBP
    • By theJBP 7th Jun 19, 11:34 AM
    • 5 Posts
    • 2 Thanks
    theJBP
    An update on this thread.

    First a quick recap. You'll recall I posted about a substantial debt I had accrued on my energy bill (gas & electric). The debt was £575.

    Basically, unbeknownst to me, my direct debit wasn't covering my energy use. I mentioned in my post that I was considering going to the ombudsman and a number of you replied and there was debate about whether I stood a chance. This is an update post and while I will also post this as a reply to my original post, I feel it's important enough to post in a new thread too so that more will see it.

    After protracted negotiations and threats from myself, the energy supplier has ADMITTED LIABILITY. They basically accept they have an obligation to inform customers when a DD is not covering energy use. The exact wording was the following:

    "...a duty of care to ensure that customers do not fall into an unmanageable amount of debt and have a responsibility to advise customers if and when their account starts to fall behind. In your case, due to a technical error these communications were not activated and we did not step in early enough to prevent this."

    They have now offered me £150 off my debt as a "goodwill gesture".

    The reason I feel this is so significant is because I have noticed other threads on this forum discussing accrued debt. As mentioned, there was debate on my original thread about whether customers had rights in this area. Somebody posted a link to an article where the ombudsman was quoted as expressing concern about accrued debt. Personally, I think my experience shows that the energy companies know they are in the wrong. I am yet to decide whether to take my complain further and go to the ombudsman. But the fact is this situation should not be happening.
    • Consumerist
    • By Consumerist 7th Jun 19, 11:51 AM
    • 5,222 Posts
    • 2,609 Thanks
    Consumerist
    An update on this thread. . .
    They have now offered me £150 off my debt as a "goodwill gesture".

    The reason I feel this is so significant is because I have noticed other threads on this forum discussing accrued debt. As mentioned, there was debate on my original thread about whether customers had rights in this area. Somebody posted a link to an article where the ombudsman was quoted as expressing concern about accrued debt. Personally, I think my experience shows that the energy companies know they are in the wrong. I am yet to decide whether to take my complain further and go to the ombudsman. But the fact is this situation should not be happening.
    Originally posted by theJBP
    Thanks for sharing.

    If they have also withdrawn their objection to your transfer then you probably won't do much better by going to the ombudsman - as I understand it, they are limited to £200 compensation payments.

    Once you have switched, you can probably set up an arrangement to repay the remaining balance owing to the supplier.
    Last edited by Consumerist; 07-06-2019 at 11:54 AM.
    Warning: In the kingdom of the blind, the one-eyed man is king.
    • antrobus
    • By antrobus 7th Jun 19, 1:00 PM
    • 16,693 Posts
    • 23,632 Thanks
    antrobus
    ...

    Basically, unbeknownst to me, my direct debit wasn't covering my energy use. ...
    Originally posted by theJBP
    My advice would be; in future, check your bills, Your monthly DD will be based on your projected annual usage. It's never going to 100% bang on.

    ...
    . Personally, I think my experience shows that the energy companies know they are in the wrong. ...
    Originally posted by theJBP
    To be honest with you, most energy companies are only too quick to bang up your DD to prevent any build up of debt. Lumo appear to be a bunch of idiots.

    The good news would be, that if you accept their £150 goodwill offer, you debt will be £425, which is below the £500 threshold, so they won't be able to object to any transfer,
Welcome to our new Forum!

Our aim is to save you money quickly and easily. We hope you like it!

Forum Team Contact us

Live Stats

101Posts Today

2,229Users online

Martin's Twitter
  • Snap post #BBCOurNextPM poll: Who do you think did best. (I had to have two in one category, so I picked randoml? https://t.co/gYTNBBn3SP

  • Emily Maitliss being v mean to Boris using his own past quotes against him on Heathrow, having an election when lea? https://t.co/4baNAlmMid

  • Wow - impressive performance from the 15 year old climate change activist. Not sure I'd have had such confidence when still at school.

  • Follow Martin