Energy suppliers are hoarding ￡3 billion of customers’ money despite a cost of living crisis that has left some households forced to choose between heating and eating.
Consumers should usually exit winter with little to no credit, having used it up during the colder months. They should start rebuilding their credit levels during the spring and summer when energy usage is generally lower.
But new research by Uswitch.com found that more than 16 million households (56 percent) will have credit with their energy supplier at the end of this winter.
Overall, credit is ￡3.4 billion lower than last year, which may be due to energy bills being higher than the previous winter when households received ￡400 government support towards power bills.
Will Owen, energy expert at Uswitch.com said: “Despite the expensive winter for energy bills, more than half of UK households are exiting this winter with credit on their accounts.
“This may be because households were spending more on energy than the previous winter, as they were not benefitting from any government bill support this time around.
“In recent years, when bills have been so high and unpredictable, it has been a good idea to keep a lot of credit with your energy supplier.
“However, the fall in prices this spring means that consumers with excessive credit may want to consider reclaiming some of it."
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Mr Owen advised consumers to check their credit balance, and if it is high, ask their supplier to check that their direct debit is set at the right level for the amount of energy they use.
One in seven consumers (14 per cent) have balances over ￡300, and five per cent have more than ￡500 with their energy provider – but only a quarter (28 per cent) of consumers plan to ask for it to be refunded.
Two in five households (44 per cent) with more credit than this time last year say their balance built up over winter because their direct debit has been set too high.
Two-fifths of consumers (40 per cent) attribute the increase in their credit balance to their efforts to reduce energy usage, while a third (33 per cent) said they used the heating less often due to the mild winter.
It comes as nearly four million households are in debt to their energy providers to the tune of ￡771 million. On average, consumers in debt owe ￡194 to their providers.
Average debt per household has decreased slightly from ￡234 last year, although the number of homes in debt has risen by 167,000.
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In recent years, consumers have largely been advised to keep some credit in their account to help pay for energy bills that have remained high over the spring and summer.
But as bills are now falling, with the energy price cap reduced by 12 per cent in April, and a further decrease predicted in July, Uswitch.com advises consumers to check their energy account and consider reclaiming any excess amounts of credit. This is generally any amount above two months’ worth of payments.
Mr Owen added: “Although falling energy bills is good news, they are still high by historic standards and unfortunately the number of people in debt has risen slightly.
“It remains important that those who do owe money to their suppliers continue to be given the support they need, and we recommend that you contact your provider if you are worried about your energy debt.
“To ensure you are being billed accurately, make sure you submit regular meter readings to your supplier if you do not have a smart meter.”