UK energy companies have paid over £20 million in compensation to customers for billing errors over the past five years, with British Gas accounting for a significant portion of the total.
An analysis of cases handled by the Energy Ombudsman reveals a 141% rise in billing complaints during this period, reaching a peak in 2023 before stabilizing.
Billing disputes made up 54% of all complaints, alongside issues related to customer service and smart meters. Complaints against Centrica, the parent company of British Gas, have surged sixfold since 2019, with formal billing grievances increasing from 2,396 in that year to 17,965 between October 2023 and September 2024.
British Gas, serving over 7.5 million residential customers, recorded the highest complaint rate among major suppliers, with 53.7 complaints per 100,000 customers in the most recent data. Compensation payouts for billing complaints have increased from £2.4 million in 2019 to £7.1 million in 2024. Over the five-year period, the largest energy firms have paid a combined £20.4 million in compensation, with British Gas responsible for £4.15 million.
Recent figures show British Gas paid £2.22 million in billing-related compensation, followed by Ovo at £1.28 million and EDF at £426,000. These payouts were not for incorrect charges but rather to compensate for the stress and inconvenience caused to affected customers.
Experts warn that these complaints may only represent a fraction of the true scale of the problem, with vulnerable consumers often unaware of their rights to challenge inaccurate billing. Many customers have reported severe financial and emotional distress due to unexpected energy charges.
British Gas has acknowledged an industry-wide increase in complaints since 2019 but claims its own rates have recently aligned with other providers after significant investment in customer service improvements. The Energy Ombudsman highlighted challenges such as the COVID-19 pandemic, supplier failures, and rising energy costs as factors contributing to the increase in disputes. However, it also noted that complaints have started to decline from their 2023 peak.
Separate data indicates a 472% increase in complaints against dual-fuel energy suppliers over the past decade. In 2024 alone, 59,773 cases related to billing issues were recorded, up from 47,373 in 2023 and 24,407 in 2020.
Industry experts recommend the installation of smart meters or regular meter readings to reduce the risk of incorrect billing. Calls have been made for regulators to enforce stricter policies on back-billing to prevent customers from facing unexpected charges.
One case highlights the ordeal of a British Gas customer who experienced significant billing issues, estimated charges, and difficulties setting up direct debit payments, ultimately leading to a bill of over £1,100. British Gas has since acknowledged the issue and is working on a resolution.
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