Missed energy bill error saw man pay £244,000 direct debit

Energy firms must act promptly to correct billing errors, the regulator says, after customers told the BBC of wild inaccuracies, including one man's £244,000 bill for a single month.

Holiday park owner Patrick Langmaid said there was pandemonium in the office after the fee was taken via direct debit from his business account.

Regulator Ofgem said customers should not be "wasting hours" on their cases.

Issues emerged after artist Sir Grayson Perry had a "bizarre" £39,000 bill.

The Turner Prize-winner told the BBC in December his difficulty in getting answers was "an interesting fable of the technological age".

Evidence that he was far from alone includes:

Victims question how such bills are ever sent, and why banks allow payment.

Dhara Vyas, deputy chief executive of Energy UK - which represents suppliers, said that millions of bills were sent out on a rolling basis, so mistakes were inevitable.

"Sometimes they are a human error. Sometimes they are an automation or a machine error," she said.

"It is really important that a supplier acts quickly to put it right, communicates well and tells the customer what they are doing, and also offers compensation where it is appropriate."

Suppliers have pointed to estimated meter readings as being among potential causes, but Mr Langmaid said his mammoth bill came from a "not very smart meter".

He has a complex of holiday lets called Martha's Orchard on the Cornish coast, and is accustomed to relatively high bills. Normally, he pays £2,500 a month.

But, it seems, the meter on one property clocked all the way around and back to zero, and the system suggested huge amounts of energy had been used. It generated the invoice automatically, and payment of £244,000 was collected from the business's account. The funds had been earmarked to buy new caravans and pay suppliers.

"That's the frightening thing," he said. "I have an issue with the energy company for doing it, the bank for allowing it to happen, and the whole direct debit system for allowing the payment to be taken without any safeguard."

The supplier, Total Energies, admitted that human error meant the hugely inflated invoice was not cancelled.

UK Finance, which represents the banking sector, said unless the payment went into an overdraft, it would not be stopped. Direct debits were set up with sponsored, known companies, so were unlikely to raise any red flags under the banks' fraud checks as would happen with other unusual transactions.

"Energy companies have to tell you how much they are going to take out of your bank account and when," said Jana Mackintosh, director of payments at UK Finance.

So, she said, anyone with concerns about the amount or date should contact their energy company, and the bank to cancel the direct debit.

Not everyone will see the bill before the payment is taken, such as Castleton Baptist Church in South Wales, which was sent a paper bill for £44,000 but has no letterbox.

It took more than a month for the payment, which again was taken via direct debit, to be refunded.

Treasurer Nathan Evans, who said the regular bill was about £200 to £300, said: "Where are the checks and balances, especially when you consider what our bill normally is?

"The church only happened to have a large amount of money in the bank because we were left money in a will."

The supplier, SSE Energy Solutions, apologised and said an incorrect meter reading was submitted by a third-party operator and was missed by internal checks.

Customers' frustration extends to finding a way to question bills when they arrive.

Maggie Boyd, aged 77, lives alone in a one-bedroom flat in a retirement complex in Argyll and Bute in Scotland. She said her energy statement appeared to suggest she owed £41,000, and said she had spent "months of my life" trying to sort it out.

"I thought someone was winding me up," she said. "I've got a cat but I don't think she was working the dials of my [heating].

"It was laughable, but frightening at the same time and very, very stressful too."

A spokeswoman for her supplier, Ovo, said: "We're very sorry to Ms Boyd for any confusion and can confirm her account is accurate and up to date."

The balance is far smaller, and the company said it was offering support.

A spokesman for Ofgem said: ""Customers should not be wasting hours of their lives sorting out incorrect bills and we have clear rules in place making clear that when bills are inaccurate, energy firms must act promptly to put things right.

"We have also introduced tougher rules on customer service standards requiring energy companies to be easier to contact."

He said the regulator was monitoring suppliers' performance and would take further action if required.

Paul Kelly, who was selling a house which he co-owned and had let out in Bristol, said he resorted to emailing his supplier's chief executive after spending months questioning a bill for £16,000. It was subsequently cancelled.

"I was passed between a number of people within a call centre, who were all perfectly nice, but just did nothing to actually resolve my complaint," he said.

E.On said he had been sent a large "catch-up" bill which had been based on estimated readings. "We have apologised to Mr Kelly for any inconvenience caused and we are glad his complaint has been resolved."

In addition to apologies, many suppliers are offering goodwill payments or compensation.

In Mr Langmaid's case, he was given compensation of £1,000, which he told his supplier he would donate to Wadebridge Foodbank, where he is a trustee.

Total Energies followed up with a donation of their own of £1,500 - leaving the charity's surviving winter fund £2,500 better off.

Additional reporting by Kris Bramwell

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