Market view: Accuracy tops the bill

Few things annoy customers more than receiving inaccurate bills, so it is up to energy suppliers to put the right procedures in place to minimise mistakes, says Lee Gannon.

News that the big gas firms have been overcharging (and undercharging) tens of thousands of customers hit the headlines recently, causing public outrage. Competitive pricing and accurate billing has always been a top priority for customers, so it is not surprising that news of a mistake of this scale has brought the topic even higher up the public’s agenda.

The slip up, which has left some households and small businesses overcharged in excess of 130 per cent, was caused by what Ofgem labelled “human error”. So what happened? Put simply, it was a basic mistake in gas meter readings, mixing up imperial and metric units.

It sounds like a straightforward error, but the repercussions were hefty. Some were left grossly overcharged while others were undercharged by as much as 65 per cent. What’s worse, for some energy users this issue has now been going on for as long as 15 years.

While Ofgem and the suppliers involved work to ensure customers are compensated, it raises the question, how can we ensure that people and businesses across the board aren’t wrongly billed in future? There is no one-size-fits-all answer to this, but there are a host of measures we can employ.

Customer meter readings

The first is for customers to get into the habit of submitting their own readings. While suppliers are required to read and inspect meters at least every two years, if customers do not provide interim readings, then the best we can do is rely on estimated bills. As these are guided by previous usage, they can be highly accurate. On the flip-side, they can also cause major discrepancies – and this is particularly true with business customers.

For example, companies moving into new premises often get caught out relying on estimated bills based on previous occupants. They forget that they might have a completely different business process, with completely different energy needs and usage, which inevitably leads to misleading estimated bills. For instance, the energy needs of an office or shop will vary massively compared with a restaurant or catering business.

Imperial vs metric

While it is one thing to submit a reading, it is another to ensure it is done correctly. At Flogas we try and make this process as accurate and as straightforward as possible. For example, not everyone will know whether they have an imperial or metric meter, which is why we are currently updating our bills to show people what they have. As we continue to transition from old imperial meters to new metric ones, it is important to explain to people how to read both types correctly.

The most obvious differences for end users are that metric meters have five numbers to record and measure in cubic metres (m3), whereas imperial ones have four numbers and measure in cubic feet (ft3). What can be confusing for people is that despite measuring in m3 and ft3, they are then billed based on kilowatt-hours (kWh). This means, to be able to calculate the price, it is important to know how to convert both metric and imperial meter readings into kWh. This can be done using a straightforward calculation, and is something we clearly explain to customers on all our bills for complete transparency.

Due diligence

It is not solely up to the end user to feed in the correct information. This is why we assign all our customers with dedicated account managers who can support them from start to finish. They will manually spot-check all invoices before they are issued to customers. This means, if anything looks out of the ordinary on a bill, the customer will get a phone call straight away to check what the issue might be.

Customer communication is crucial to discuss any unusual spikes in usage, or anything else that does not fit within their typical usage patterns. Sometimes, they will forget to give reads for a while, or they might accidently provide an incorrect meter reading (for instance by missing a digit or two) – the key is not to take everything as read. It is important to investigate any irregularities immediately and get to the root of the issue. This is why we will even go out to sites to provide guidance with meter readings to ensure there is no room for error.

It is understandable that the recent news of wide-scale meter reading errors from major gas firms has caused angst and mistrust. People are busy and want to be able to rely on their energy supplier to have the right information and bill the correct amount. Ultimately it is up to us as suppliers to ensure this happens. At Flogas this is very front of mind, and why we focus our efforts on being completely transparent with customers while providing a personal start-to-finish service – only then can we ensure billing accuracy across the board.