Another false Economy: Energy customers were hit by mystery meter readings

Customers of failed provider Economy Energy say they were hit with mystery meter readings far higher than expected in December as the company fought for its survival.

One of the readings, seen by CityAM, inflated a customer’s monthly usage by over 12,000 units, equivalent to around three years’ average use for a household in the UK.

Read more: Economy Energy shuts down weeks after denying bankruptcy reports

Another customer, London-based Rob Barlow, told CityAM he is still owed over £600 by the supplier, which closed its doors last week.

On 13 December, a reading on Barlow’s online statement claimed he had used 2,939 units of electricity since 16 October, approximately the same as annual average household usage. A meter reading he took himself on 2 January shows he had in fact used considerably less than 500 units.

“To be fair to them, they did issue me with a revised bill after several hours on the phone although the tariff listed is still wrong,” Barlow said.

He is one of eight Economy Energy customers who told CityAM of inflated readings between 13 and 20 December. The readings, which are usually submitted by the customer or supplier, were listed as coming from an “unknown” source in online statements. All the customers have so-called dumb meters, which are currently being phased out in the UK and replaced by digitalised smart meters which give suppliers more accurate data.

Many of the readings were over 1,000 units too high and customers said they were owed as much as £1,000 from the now defunct company.

The mystery readings came at a time when Economy Energy was fighting for its life.

The company hired KPMG in one last effort to get an injection of cash which could help it stay afloat, or to sell the business, Sky News reported on 17 December.

One industry insider told CityAM they had never seen a meter reading from an unknown source on any bill.

“It would come down to an analysis of the facts and circumstances of each bill, but if it is spread over a large number of customers the regulator may be interested in that,” a sector lawyer said.

Industry insiders say the winter months, where usage goes up and wholesale prices increase, are the most difficult for cash-strapped suppliers to get through. If companies can survive until the spring they will often be able to continue trading until the following winter.

At the end of last week regulator Ofgem said it had appointed Ovo Energy to take over Economy Energy’s 235,000 domestic customers. It said that the supplier would “absorb all of the costs of honouring customers’ credit balances”, meaning Ovo will have to pay back customers who have been overcharged for their electricity usage.

The regulator had banned Economy from taking on new customers, requesting one-off payments and increasing direct debits on 4 January over customer service concerns.

A spokesperson for Ofgem said: “We advise customers of Economy Energy to take meter readings and wait for Ovo Energy to contact them when their account has been set up. Ovo Energy will calculate if your account is in credit or debit.”

Jane Lucy, from switching service Labrador, told City A.M: “This story highlights the increasing importance of data in this industry – to pick up a potential issue, prove error and trace cause. Thankfully, the time of suppliers being free to effectively charge what they like, with consumers unable to defend themselves are gone.”

Read more: Economy Energy banned from taking on new customers amid Ofgem probe

The Energy Ombudsman said it had received 881 complaints about Economy Energy in December alone, “more than double the number we received in November and one of the highest monthly complaint totals we have ever seen outside the big six.”

Economy Energy declined to comment.