UK energy suppliers sitting on £7bn credit belonging to 16m households
Energy suppliers are hoarding nearly £7bn of customers’ money despite a cost of living crisis that has left some households forced to choose between heating and eating.
More than 16m UK households are collectively in credit by £6.7bn to their suppliers, with half of those holding balances of more than £200, research from comparison site Uswitch.com has shown.
The study said that a combination of mild winter weather and extra consumer effort to reduce energy usage has left companies holding £5bn more in credit than this time last year.
Typically energy customers on direct debits will build up credit during summer, when usage is low, and suppliers will run that down over the winter months when consumption is higher.
However, consumers have complained that energy firms are hoarding hundreds of pounds of their money this winter.
The practice threatens to stretch budgets already tested by the cost of living crisis and further damage the reputation of an industry that has suffered nearly 30 casualties since the energy crisis began in 2021.
Energy companies study wholesale prices and consumers’ historical usage to calculate their annual bills, setting their monthly payments based on this.
The Uswitch research showed that the number of households in credit has risen by 5m, up from 11m households in April 2022, and that more than eight million bill payers are now more than £200 in credit.
The analysis showed the number of consumers in debt had fallen from six million to four million, and the total amount of debt owed had fallen from £1.2bn to £920m. The average amount owed by households who are in debt has risen, however, from £188 to £234.
The Uswitch research showed that customers in Plymouth had the highest average credit balance, at
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