Energy suppliers to provide direct debit refunds to customers in credit

British energy customers who are in credit with their suppliers will be offered direct debit refunds following negotiations chaired by Energy and Climate Change Minister Greg Barker, the DECC (Department for Energy and Climate Change) has recently revealed.

DECC has been in talks with energy companies to provide customers with an automatic refund if they have a credit balance over a minimum threshold (varying between 1p and £10) at annual review point. While EON were already doing this, the negotiations have resulted in EDF, British Gas and SSE plus First Utility following suit.

As part of this agreement, at the mid-year point on an annual direct debit arrangement, the supplier will ask the customer for an actual meter reading if necessary and once they have received it, they will review the direct debit and change it to make it as accurate as possible for the remainder of the year to avoid a large build-up of credit or debit on their account. Alternatively, the money can be rolled over to take off the next bill if the customer prefers.

Rt Hon Greg Barker, Minister for Energy and Climate Change said:

“This is important and welcome news for the 55 per cent of energy customers who chose to pay by direct debit. The Coalition is committed to helping hardworking people reduce the cost of energy bills and this will ensure that customers are rightly returned the cash that is theirs without having to ask.

“There is still more to do but this builds on the Coalition reforms to the energy market, and to have five of the major energy companies agreeing to this new approach will go a long way towards rebuilding consumer trust. I hope other energy companies will adopt this approach very soon.”