Credit balance refunds: Putting money back in consumers’ pockets

Ombudsman Services has welcomed plans to limit the amount of money energy suppliers can hold as credit balances.

Energy regulator Ofgem, which unveiled the proposals today (Wednesday 17 March), says the change could mean up to £1.4 billion in total (around £65 per household) being returned to consumers.

The ‘auto-refund’ policy would require suppliers to refund any credit balances, for domestic credit customers paying by fixed direct debit, on the anniversary of when they started their contract.

Reacting to the news, Ed Dodman, director of regulatory affairs at Ombudsman Services, said: “Just as people are expected to pay their energy bills on time, we think it’s fair to expect energy suppliers to do the same with refunds.

We know from looking at complaints that suppliers can sometimes take too long to issue refunds, which can be stressful for consumers."

You can read more about the proposed changes on the Ofgem website.