cutting energy costs

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This is an article I’ve written for November’s Qube magazine, might save you money….

Businesses have been warned they could be paying millions of pounds over the odds for gas and electricity because of inaccurate bills.

An energy consultancy claims that up to fifteen per cent of bills to industry may be wrong, costing companies tens of thousands of pounds a year.

It says the market has become so complex that mistakes can easily creep in and companies often pay the inflated charges without looking at the details of their bill.

The comments have been backed by the Major Energy Users’ Council which says the situation for businesses is chaotic.

Chairman, Andrew Bainbridge said; “Bills for gas, electricity and water are quite often in a state of chaos.

“Errors are very, very frequent and checking bills is a very important part of saving money for businesses.”

His comments came after the Nottingham-based energy consultancy Envirup said up to 15 per cent of the bills it looks at are wrong.

The company has just won a refund of more than one hundred thousand pounds for a client.

Managing Director, Assim Ishaque, said: “Any business could be being overcharged without ever realising.

“Billing systems have become very complicated and  mistakes can easily be made by the energy supplier.

“When they are sent on to businesses they wouldn’t think to query their bills and wouldn’t realise that they are paying too much. It is just automatically paid and this can go on for years.”

He said the problems include incorrect readings, faulty meters or the wrong tariff or penal default charges.

Last year the energy regulator, Ofgem, carried out a report into the energy market for small and medium firms.

It found that small businesses often operated like a domestic customer. It said small firms in particular were unaware of how to compare prices and unsure how to select energy products.

It found that business customers were often automatically rolled-over onto longer-term contracts when their existing deals ended.

Ofgem introduced new guidelines for electricity suppliers after its investigation.

Now suppliers have to give clearer information about contracts and more notice when they are coming to an end.

But an Ofgem spokesman said it had not found that inaccurate bills were a major issue. He added that if companies were having problems, they should contact their supplier.

The Major Energy Users Council, however, insisted it had been a problem for decades.

Andrew Bainbridge said; “Fifteen per cent of bills being wrong sounds like a realistic figure to me.

“If an organization is big enough to have its own rigorous bill checking procedures it saves itself a lot of money.

“If not it should use consultants who can pore over bills to spot the errors.”

“We have been hearing this complaint for many years now and it’s become an important part of money saving.”

Envirup is now running courses for business people to help them understand how to read their bills.

The classes, which are being organized by Business Link, will teach companies how to spot the common errors that can creep in.

It was set up after the company discovered mistakes that were costing clients tens of thousands of pounds.

“We were called in by one property management firm who had a large site in London. They just wanted to see if they could cut their bills,” said Ishaque.

“But in fact we found that they were being heavily overcharged. They had three meters on the site, two were linked and should have counted as one meter, but they were being billed for all three, instead of just two.”

The company got a refund of £102,500. It also had its electricity bill cut by almost sixty thousand pounds a year.

“We had another client who had a bill of £27,000 for two years, but they should only have paid £5,000. They got a refund of £22,000,” said Ishaque.

“Everyone in business is looking for ways of cutting costs and here is something quick and easy that you could do which could save you thousands of pounds.”

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