Energy bills: why you should know about the back-billing rules

Simple rules overseen by the regulator prevent energy companies from billing customers for energy used more than 12 months ago, but they aren’t always adhered to.

Ofgem, the energy regulator, has clear and long-standing rules which state that you can’t be billed for energy you used 12 months ago if you’ve previously asked for a bill for that period of time and haven’t received one,  you weren’t informed about the charges or your direct debit charges were set too low to cover it.

Earlier this year, Ofgem sought data on how many customers had incorrectly been sent back bills and warned suppliers that they would face fines if they continued to send these out.

The Energy Ombudsman, which helps resolve energy complaints, told us it received 3,218 disputes relating to back-billing last year, making up around 3% of total complaints in 2024. Which? often helps exasperated energy customers resolve back-billing disputes.

Here, we take a look at some back-billing complaints and explain what to do if you're incorrectly billed by your energy company.

‘Eon charged me to repay a debt that they were not able to justify’

Peter contacted Which? complaining that his direct debit bills from his energy supplier Eon were inaccurate. He was sent a bill for more than £7,000 for a period where his previously faulty smart meter wasn’t registering gas readings.

After complaining, this was eventually reduced to a debt of £700. However, his own calculations of historical gas use, including one year of back bills and his current electricity use, were less than his direct debits.

While his direct debit payments were adjusted to an amount he agreed with, Peter still believed that the direct debit payments he had already made more than covered the £700 he owed when his smart meter wasn’t working, and he should have had no outstanding debt.

Which? contacted Eon and it told us that Peter’s billing was incorrect due to an identified issue with his gas meter not sending accurate readings. It said that this issue was corrected but led to a catch-up balance on the account. It said that bill for £7,000 was never issued.

Eon went on to say that it will provide Peter with a full breakdown of his gas use in kWh for the relevant period and has given him a £75 goodwill payment. It also applied adjustments to his account, leading to it being in credit by £45.24.

‘British Gas failed to bill us for nearly two years’

Liam and Carol Dalton (not their real names) hadn’t received an energy bill in nearly two years by the time they contacted Which? due to a software issue with their supplier, British Gas.

‘We were forced to keep paying in large monthly payments as we were in the dark as to the status of our account,’ they told Which?

Eventually, they escalated their complaint to the Energy Ombudsman to get British Gas to issue them a bill. They were given a bill for £8,249.17, which covered the nearly two-year period they hadn't been billed for. This violates Ofgem rules, which state that you cannot be charged for energy used more than 12 months ago if you have not had an accurate bill for it before.

Which? contacted British Gas, which told us it stopped billing the Daltons after it stopped receiving data information from an industry database for their account.

It told us that the Daltons kept up regular direct debit payments and accrued a balance totalling £5,163, which they have now been refunded for, and received £200 in credit as a goodwill gesture, as well as an apology.

What is the government doing about back-billing?

The Energy Security and Net Zero Committee, the government department that evaluates energy policies, looked into the practice of back-billing by energy companies earlier this year.

It found that back-billing issues aren’t systemic but still affect thousands of energy customers and need to be addressed.

The committee is also looking at how Ofgem can provide better help to consumers with their energy problems. It will evaluate whether the back-billing period should be reduced to six months, particularly where the customer has a smart meter, so readings should be accurate.

The committee is also looking at potential measures, such as implementing automatic compensation so that customers benefit from a simpler redress process and making communication around bills more transparent, so that customers have a better understanding of their rights.

How is Ofgem tackling back-billing issues?

Which? contacted Ofgem about the government’s review into back-billing, and it told us that it’s currently assessing suppliers’ performances in accordance with its billing rules to determine if the current rules are fit for purpose.

It also told us that it’s reviewing the timeframe within which suppliers can retrospectively bill customers in cases where the error is the supplier’s fault. It will also look into suppliers’ billing practices to understand where improvement is needed.

What to do if you think you’ve been incorrectly back-billed

If you receive an energy bill which dates back to 12 months ago or more, your supplier isn’t allowed to charge you if it was at fault. This could be because:

• You’ve never been given an accurate bill before, despite asking for one.
• You haven’t previously been told about these changes through a statement of account.
• Your direct debit payments were previously set too low to cover the amount.

If this is the case, you should contact your supplier and let them know why you shouldn’t be billed and provide any evidence, such as your billing history and dated meter readings. Your supplier should then issue you a refund.

If you can’t reach a resolution with your supplier, you can escalate your complaint to the Energy Ombudsman. Suppliers have eight weeks to respond to your complaint before you can escalate it, unless you receive a deadlock letter before this time period (indicating that your supplier can’t do anything else to help resolve the issue).

If you end up owing the money on the bill, due to previously ignoring requests for payment from your supplier, for example, you can ask to set up a payment plan, allowing you to pay the debt over time. Read more about how to get help if you're struggling to pay for your energy bills.