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British Gas pays out £2.65 million for overcharging customers

Find out when can you cancel your gas and electricity contract

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British Gas wrongly charged some customers exit fees and overcharged others who wanted to switch energy supplier. Meanwhile exclusive Which? research reveals that one in six energy customers believe they can’t cancel their energy contract, even if the price rises.

Some 94,211 customers were overcharged after they decided to switch to a new supplier but were instead charged British Gas’ more expensive standard tariff rate.

More than 1,600 British Gas customers were incorrectly charged exit fees – totalling £64,968 – when they switched energy company. Another 2.5million customers were wrongly told (in their terms and conditions) that they’d have to pay exit fees throughout the length of their tariff. British Gas has now compensated customers.

In fact, exit fees must not be charged in the last 49 days of your contract.

But many consumers are unaware of this. Which? research found that 17% of people believe that they’re locked into an energy tariff contract and can’t leave until it ends – even if the costs increase.*

Keep reading to make sure you know your rights with energy companies, and find out when you can switch gas and electricity supplier. You can also compare gas and electricity prices with Which? Switch to find the best energy tariff for you.

Know your energy switching rights

If you’re on a fixed energy tariff, you can switch without paying any exit fees in the last 49 days of your contract. This is called the ‘switching window’ and is a condition that all energy companies must obey in order to sell gas and electricity.

Exit fees, which can sometimes be around £30 per fuel type, are payable if you wish to change energy supplier during your contract (before the last 49 days). But not all energy companies charge exit fees on their fixed deals – check your contract if you want to switch.

A fixed energy tariff ensures that the price you pay for gas and electricity will stay the same for a certain period of time – one or two years, for example.

Know your rights on when energy company exit fees apply.

Variable energy tariffs and exit fees

Exit fees do not apply to variable tariffs. These have no end date, and the prices you pay can go up and down when energy companies change their prices.

You are free to switch away from a variable gas and electricity tariff whenever you wish, without paying a fee.

Affected British Gas customers

British Gas said that it has refunded all customers who were overcharged by more than £1. It has also paid out £502,633 in compensation to them.

A system error led to customers who decided to switch being wrongly overcharged on its standard variable tariff rate, British Gas said.

Energy regulator Ofgem begun investigating British Gas in 2017. The supplier paid an extra £244,770 to compensate affected customers after the investigation.

Worried you’ve been overcharged for gas and electricity? Use our template letter to complain about your energy company overcharging.

*Online survey of 2,395 Which? members in August 2018.

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