Free Electricity For 20 Years.... Feels Like Off The Grid... What Happens When They Forget To Bill You??
Categories: Home Stories
Carol Kellar has ended up enjoying 20 years of free electricity worth an estimated £10,000 after somehow slipping through the system back in the 1990s when her house was incorrectly marked down as having been disconnected.
It's a happy ending for the mother of one, whose partner had originally contacted Guardian Money to ask for our help with solving the mystery of her non-existent electricity bills.
The Money team receives scores of emails from readers every day, but our ears pricked up when this one dropped into our inbox: "Hi, I have not received an electricity bill – for almost 20 years."
The email explained how Kellar was keen to sell her house but was worried about how to sort out her unusual dilemma. Who do you contact when you've never received a bill? What should she say to a prospective buyer? And could a utility company – whoever it might be – suddenly present her with a monster "back-bill" for thousands of pounds?
It is an intriguing case, and one that raises wider questions about what you should do – and what your rights are – if you haven't received an energy bill for a long time.
As part of her divorce settlement, some of the proceeds from the sale of the family home were used to buy the three-bedroom house that Kellar still lives in. She moved into the property in Altrincham, Greater Manchester, in 1993. She says that, back then, her ex was in dispute with the electricity company about the bills relating to the home that was sold, and all the correspondence was going to him. When no electricity bills arrived at the new property, she assumed he was paying them.
"Periodically someone would turn up to read the meter, and then they would disappear and I wouldn't get a bill," Kellar told us. And so it has continued – although the meter readers no longer appear.
Carol Kellar has no received an eloectricity bill in 20 years
Kellar: first thought her ex was paying. Photograph: Christopher Thomond for the Guardian
Over the past two decades she has enjoyed an uninterrupted electricity supply (she has gas central heating and a gas Aga). And she has, of course, never switched supplier.
Things came to a head because she wants to sell, and that raised the question of what she would say to a potential buyer. "I don't know how to put this right. I know I have to pay but I don't even know which company I should approach. Can the utility company demand payment even though they should have received meter readings in the past? I don't even know if the previous owner had any bills. Help!" said the email sent to our Consumer Champions column.
Guardian Money decided to investigate. Twenty years ago it is likely she would have been a customer of Norweb – which no longer exists. The company was bought by North West Water in 1995, and the combined group became United Utilities. The customer base was sold off in 2000 to TXU, which was itself bought by Powergen (now energy company E.ON) in 2002, while a company called Electricity North West owns and operates the region's electricity distribution network after buying it from United Utilities in 2007.
Some might say that with companies constantly being bought and sold, resulting in customers changing hands to that extent, it's surprising more people don't fall through the net.
First we spoke to Electricity North West, which told us its records showed that Kellar's property's MPAN, or metering point administration number – like a serial number on the meter – was disconnected in 2003.
It appears this was done because information was received from the supplier stating that there was no activity on the meter – ie it wasn't being used.
It is assumed a few thousand of the UK's 24m homes are not billed.
Then we spoke to a very helpful woman at E.ON, and the mystery deepened. She told us: "The property was supplied by Norweb and marked as disconnected in 1998, so it appears that no supplier has been sending the customer bills since then." She added: "We have been out to gather details of the meter and have agreed to set up a new account."
So it's far from clear what actually happened and why she never received any bills as far back as 1993 – but what about the $64,000 question: was Kellar going to be hit with a huge back-bill? E.ON told us: "We will not be back-billing her." That decision reflects the fact that, as E.ON said, "we wouldn't have records [as to what happened in 1998] – we didn't own the company then".
"That's marvelous news," Kellar said when we phoned her. She can't think of anything in 1998, or at any other time, that might explain what happened. "Why would they mark it down as being disconnected?"
It's almost impossible to calculate how much Kellar would have paid over 20 years, though a typical annual domestic electricity bill in the Manchester area was £478 in 2012, according to government data. That suggests in today's money she might have saved just shy of £10,000 (or maybe less or more than that).
So what are the rules on back-billing? Ofgem says companies can't back-bill people for energy used more than 12 months ago "if the supplier was at fault for not having sent a bill to the customer".
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Back-billing depends on culpability. Photograph: Andrew Milligan/EMPICS
This might mean, for example, that the company failed to bill you at all, even though you have made efforts to contact them, or they billed you using estimated meter readings instead of readings provided by you or a reader.
Under the rules, you can't be charged for more than six years of back-billed energy charges, even if the company is not at fault. However, Ofgem told us: "Most of the Big Six (British Gas, EDF, E.ON, npower, Scottish Power and SSE) have reduced this to three years, and are looking to reduce it to one year for all instances."
Ofgem has a factsheet while the Citizens Advice website carries useful information for people who haven't received an energy bill for a while.
Citizens Advice says that for those in this situation who are having difficulty paying, the company should offer them a payment plan that allows the individual to repay any debt over the same length of time that it has built up, if you have not had a bill from your supplier for three years, you should be able to spread the repayments over three years."or example, if y
source: The Guardian