Bills continue to rise even as households save on heating

A smart meter

National Energy Action says suppliers are not using smart meters enough (Picture: Getty Images)

Households are unfairly seeing their energy bills soar even as they have cut gas and electricity, charities have warned.

Providers are too slow to recognize when their direct debit customers have saved, leaving some with massive upfront payments and prompting others to switch to more expensive contracts, the energy regulator said.

Ofgem accused companies in July of treating billpayers like an “interest-free corporate card” and urged them to take immediate action.

But Ann Taylor has seen direct debits for her three-bedroom semi-detached house in Stockport, Greater Manchester, rise from £155 to £252 a month despite turning the thermostat down to 10C.

“Turning on the heating now feels like a luxury,” the E.ON customer told The Sunday Times.

Business Secretary Grant Shapps has written to energy companies and said he was “disturbed” to hear that direct debits are increasing “as customers make major efforts to reduce their consumption”.

Energy costs have skyrocketed around the world, sending all UK customers higher bills and prompting many to take advantage of a mild autumn by turning off the heat.

Grant Shapps has written to energy companies

Grant Shapps has written to energy companies (Picture: Getty)

National Energy Action’s Peter Smith said the direct debit problems would pose “big challenges” for people trying to save.

“Utilities haven’t taken full advantage of smart meters yet,” he said. He added that customers are switching to more expensive standard contracts out of frustration with direct debits and fear their suppliers could go bankrupt, putting their bulging balances at risk.

Ofgem found 500,000 customers had more than doubled their direct debits between February and April as the energy price cap rose. She asked five companies to submit action plans within two weeks.

But it refused to say whether the situation had improved since July, insisting: “We continue to take this work forward.”

E.ON said it verifies direct debits with every payment, but eligible customers could wait a year for their savings to be reflected in the bills.

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Justin Scacco

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