Martin Lewis has called out UK energy firms’ billing tactics as he urges MPs to take action.
Back-billing, where an energy firm sends an unexpected bill for energy used over 12 months ago, is occurring too commonly, the money expert told the cross-party Energy Security and Net Zero Committee.
Under current rules, energy firms should not back-bill for more than 12 months as long as there hasn’t been an unreasonable obstacle. For instance, this could be when a customer ignores requests for payment, or attempts to conceal their level of energy use.
Mr Lewis said this criteria was too open to interpretation and, alongside a lack of proper enforcement, allows energy firms to back-bill customers when it is not reasonable to do so.
The money expert gave an example of someone who wasn’t available for a meter reading when the energy firm had asked. “They were not available at the time, so the meter reader went away. They then sent letters to that person. That person says they didn’t receive the letters. Has the company done enough?” he said.
“The company will clearly say it’s done enough. The consumer will clearly say it hasn’t done enough. Where is the dividing line?”
Mr Lewis added that he believed there are even some companies who are back-billing when they “clearly know” there has not been an unreasonable obstacle. But he said there was also an issue with enforcement of the rules, with greater powers needed for the energy ombudsman.
Popular provider Scottish Power is “particularly abominable”, Mr Lewis told MPs. “I hope it’s improved over the last few years, but I know that I can say that here without any worries. So I will say it, Scottish Power has been particularly abominable of its billing over the years,” he said.
The Money Saving Expert founder was being questioned at the time by Bill Esterson, chair of the Energy Committee. The Labour MP wrote to Ofgem in February with concerns after his own experience of being sent a bill by his supplier for “well beyond” the 12-month cut off.
“Fortunately, I was able to navigate the complaints landscape and resolve the issue,” he told the regulator’s CEO Jonathan Brearley.
“My concern is that not everyone will have the time, energy or knowledge to push their case, and that the personal stories we hear about miss all of the people who simply paid the bill presented to them.”
Asked if he supported calls to reduce the allowable back-billing period to six months, Mr Lewis said: “We live in a modern digital age where we’re trying to have smart meters installed that can give you an instant reading of what is going on in your energy system.
“Why should a firm take over six months to give you a correct bill? I can’t see any reason for that.”
Energy costs have been rising since October 2024, with Ofgem’s energy price cap set to rise for a third consecutive time in April. This will bring the energy bill for an average household up to £1,849, up 6.4 per cent from £1,738.
Responding to Mr Lewis’ comments, a spokesperson for Scottish Power said: “Scottish Power has worked hard and made great strides in customer service with Citizens Advice ranking us as the best big supplier. We have robust processes and a unique customer system which consistently delivers a high performance on billing for our customers.”
