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Daily Mirror
Daily Mirror
Business
Sam Barker

Martin Lewis issues energy bill warning after 700,000 people left without refunds

Consumer champion Martin Lewis has told energy firms to 'up their game' as thousands of consumers it snapped up from failed suppliers are still owed money.

Dozens of energy companies have stopped trading due to the rising cost of gas.

When this happens, energy regulator Ofgem steps in to help swap the customers over to a new supplier.

British Gas has picked up more than 700,000 of the 2million Brits left adrift by the collapse of their old energy company.

The founder of MoneySavingExpert made the comments after its s urvey of 12,000 people found that those who switched to British Gas felt the most disappointed.

One in five people who switched to British Gas in September and October were still owed cash from their old supplier months later.

The figure rose to nine in ten for switchers from PFP Energy and People's Energy.

Generally, missing credit balances, billing delays and poor communication were common problems listed by customers who had been switched.

The survey also found that half of energy customers switched over had found it tough to contact their new energy supplier.

A British Gas spokesperson said: "As a responsible business, in the last six months we’ve stepped in to take over the energy supply of over 700,000 customers from eight different failed suppliers, this is the largest proportion across the industry in terms of number of customers and in terms of number of failed suppliers.

"Unfortunately, each of these suppliers has its own process in terms of how they share data, including around credit balances and we are reliant on their processes.

"In some instances this has taken longer than we would have liked and we appreciate this is unsettling for customers. The majority of credit balances have now either been applied or will be shortly, and we have been in touch with individual customers where there has been a delay."

Lewis said energy firms had faced massive challenges in recent months, but that didn't mean customers should feel left behind.

He added: "Over the past six months, the challenge to the energy industry, due to huge spikes in wholesale costs, is unprecedented.

"Dozens of providers have collapsed, far beyond anything the Ofgem 'safety net' was designed to cope with, leaving the remaining firms struggling to pick up the pieces.

"Yet times are tougher still for those failed firms' customers. Millions have been moved to new firms they didn't choose, and with the collapse of cheap switchers' deals, they've had little choice but to stay there – often left confused and frustrated by an opaque and inflexible process."

Why have energy firms been struggling?

In a nutshell, because the cost of supplying energy is higher than the bills power companies can charge households.

The cost of the average variable rate energy bill, for the average household, is capped by Ofgem.

That cap is rising from £1,277 a year to £1,971 on April 1 , and could rise further in October.

That sounds high - and it is.

But even so, the increasing cost of natural gas means the running costs for many energy firms are even higher.

Dozens have found they are selling energy for less than it costs them to supply, and have had to stop trading.

If that were not enough, the cost of other goods is going up too.

Annual food bills are going up by around £180 as the cost of living crisis continues to squeeze households.

Council tax bills will increase by around £100 in April because of the spiralling cost of social care.

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