Human error and complex data flows have resulted in UK businesses being charged hundreds of millions of pounds more than they should have been for the energy, new research has shown.
Analysis carried out by utilities consultancy Inenco uncovered the errors, which it blames on a range of different players in the energy supply chain, from suppliers to meter operators and distribution network operators.
Inenco chief commercial officer David Cockshott warned that the “size and scale of this issue means this is not just small change being discussed”.
He urged companies to look again at their energy bills and claim back any money owing to them. Businesses have the right to refunds on incorrect bills dating back up to six years.
Businesses in the retail and leisure sectors are the most likely to have been affected by billing errors, according to Inenco’s analysis which examined “thousands” of invoices.
This is due to their “complex portfolios of sites with multiple meters and frequently changing tenants”. These complexities can easily lead to errors because a business with a large number of sites in its portfolio will have hundreds of half-hourly meter reads automatically submitted each day. This creates huge volumes of data and, consequently, “large margins for error”.
The public sector has also been hit hard by charging mistakes, with Inenco calculating that around £112m could be recovered. The consultancy warned that the public sector could be overpaying for its energy use by the equivalent of a third of the NHS’ annual electricity bill.
One in five busienss energy bills might be wrong, according to Inenco. Some of the highest value individual errors it uncovered include:
- A major supermarket being overcharged £700,000 in duplicate charges
- A food manufacturer paying over £300,000 in inaccurate network charges
- A £775,000 refund for a property management agent from paying incorrect rates for a year
“Paying too much for energy bills because of simple data issues or human error is easily resolved and can result in significant savings for businesses, from direct refunds to preventing future unnecessary pay-outs,” said Cockshott.
He added: “Whilst smart meters and smarter systems will go some way towards preventing future inaccuracies, the energy supply chain must work harder to prevent these issues from happening.”
More detail on Inenco’s analysis of inaccurate business energy bills can be found in its report Uncovering the Missing Millions.