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What does being in energy credit mean?

If you're in credit on your energy account, you might be able to claim some or all of it back. Find out when to claim and how to do so.

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Your energy account is in credit because you’ve paid more money to your supplier than you currently owe it. This usually happens if you pay for energy in advance by Direct Debit. Payments are spread throughout the year to even out the costs. The idea is that you pay more than you use during the longer, warmer summer months to build up credit. When your energy usage increases during the shorter, colder winter months, you supplier uses your credit to offset the increased bills. This means your Direct Debit payments remain fixed throughout the year, making it easier to budget.

But it’s possible that you’ve built up far more credit than you need to keep your account in credit during those colder months. This can happen because your Direct Debit payments are estimated costs based on several factors:

  • Cost of energy: If you’re not on a fixed-rate tariff, then the cost of each unit of gas and electricity fluctuates throughout the year. If the price of energy is lower than expected during that period, you could end up paying more than you need to cover your costs.
  • Your energy usage: Your supplier estimates how much energy you’re likely to use based on previous usage. If you end up using less energy for whatever reason – you've made energy efficient home improvements, for example – then your credit builds up.
  • The frequency of meter readings: The more often you send meter readings to your supplier, the more accurate its assumptions are. This helps ensure your Direct Debit payments aren’t set too high for a prolonged period.

Suppliers usually review customer accounts once a year, based on a recent actual meter reading. They may then automatically offer a refund. But your supplier is more likely to use your credit to help pay your next bill. Instead of refunding the money directly, it reduces your Direct Debit payments. You won’t receive the money in a lump sum, but you get it back over time through lower monthly payments. 

After completing your energy switch, your old supplier should send you a final bill within 6 weeks, confirming how much it owes you. It must then automatically refund you within 10 working days of sending the bill.

If you don’t hear anything or receive a bill within 6 weeks, contact your old supplier with your old account information to hand. You can get this from a recent bill. Failing that, it should be able to locate your account from your contact details.

There is no time limit on claiming a refund – and if you’re unhappy with the supplier’s response, make a complaint.

According to Ofgem, you can claim a refund on any credit you have at any time. Suppliers are expected to refund you promptly unless they have “reasonable grounds” not to. For example:

  • Your Direct Debit payments won’t cover your future bills without a credit balance in place. This is particularly true during autumn and winter when your energy usage and costs increase.
  • You’ve not supplied a recent meter reading, or your smart meter isn’t working correctly. 

Sadly, some suppliers have been known to ignore this ruling. Many customers have found their energy supplier unwilling to refund money, even if they are thousands of pounds in credit. Ofgem has accused suppliers of hanging on to customers' money to use them like an “interest-free company credit card”.

If your supplier refuses to refund all or part of your credit balance, it must give you a valid reason for doing so. If you disagree, make a complaint.

Claims for energy refunds can be made when:

  • Your account is closed: This happens when you switch supplier or move home. You supplier should pay your refund automatically, but you may have to chase your supplier.
  • Your energy usage drops and you have credit in your account: The best time to claim in these circumstances is usually during the Spring months – around April time. This is when your energy usage should have dropped. Check that your Direct Debit payments are once again larger than your monthly bills – this means you’re building up credit again.

If you’re switching supplier, your old supplier should send a final bill within 6 weeks with confirmation of the credit left in your account. Your supplier should then refund this automatically within 10 working days.

But there have been examples recently where this hasn’t happened. Contact your old supplier if you’ve not heard anything within 6 weeks, or not been refunded promptly after receiving your final bill.

If you’re looking to claim a refund from your current supplier, you need to contact it directly. Check your online account – you may find there’s an option to claim a refund there. If not, phone or email your supplier. Before claiming, make sure there’s a recent meter reading on your account, and check your account balance.

You can claim all or part of your credit balance, so consider holding some back to help cover the cost of your increased energy usage during the winter months. Your supplier may be able to help you determine how much to leave in your energy account. Failing that, consider recovering some of the balance by reducing your monthly Direct Debit payments. However, again make sure you don’t leave yourself short for those expensive winter months.

What’s the exact account in credit meaning?

When your energy account is in credit, it means that your account has a positive balance after your latest bill has been deducted from it.

I don’t remember the name of my energy supplier. Can I still claim my energy credit?

You need to know the name of your supplier to be able to contact it to claim a refund. You can find this information on a recent bill. If you don’t have this to hand, check out our guide to identifying your energy supplier.

How do I avoid being overcharged by my energy supplier?

The most effective way to avoid being overcharged is to keep a close eye on your account. Check your latest bill carefully or visit your account portal online for up-to-date information. If you have a non-smart meter, make sure you send regular meter readings – at least once a month.

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