What Does 'In Credit' Mean?
When you receive a utility bill or gas/electricity statement, you may struggle to understand its contents, and you’re not alone!
According to research by energyhelpline.com, an alarming 11.1 million utility customers confessed that they do not understand their utility bills - that’s four out of every ten energy consumers.
To help you unravel the mystery of energy bills, let’s kick off with the basics.
Utility bill meaning
A utility bill is a statement or invoice sent to customers for gas and electricity, or water and sewerage or telephone and broadband.
A utility bill will detail what consumers have used, how much this has cost and in the case of energy suppliers, confirm if their account is in credit or debit.
Because so many people specifically struggle to understand their electric and gas bills, Ofgem (the government’s energy provider regulator), has provided useful guidance for consumers, including an explanatory video.
What does in credit mean?
An energy bill in credit will have an elusive ‘CR’ after an amount to indicate your energy account is in credit.
So a CR on a bill means you have paid for more gas and/or electricity than you have actually used. Credit is usually accrued during the summer months when we all use less energy.
Credit will usually be rolled over and credited to your next statement. However, if the credit amount is quite high, you can contact your energy supplier to specifically request a refund.
What does in debit mean?
A utility bill in debit will likewise have a ‘DR’ printed after an amount. So a DR on a bill means you are ‘in the red’ and have used more gas and/or electricity than you have paid for, and you currently owe your energy supplier money.
If your account is significantly in debit and you pay by direct debit, your utility provider will usually increase your monthly direct debit payment to compensate and bring your account into credit. Your energy supplier is obliged to notify you before doing this.
Many utility accounts are in debit during the winter months, especially if your winter bills are based on a meter reading given during the warmer and lighter summer months.
Also, if you don’t supply regular meter readings (or do not have a smart meter installed) and your bills are based on estimated readings, this can also easily lead to your account being in debit.
To avoid your account being excessively in credit or debit, you should submit regular meter readings to your provider, especially during the winter months.
If you’re struggling to pay your utility bills, check out our guide: How to save money on your utility bills.
Do energy companies have to refund credits?
Yes, if you have an energy account that's in credit, you can request a refund from your energy supplier at any time and utility companies are obliged to refund credit unless they have valid and justified reasons not to.
Before you request a credit refund, if it is during the summer months, bear in mind that your energy bills will increase in the winter months and so building credit could level out your payments over the year.
Energy company not refunding credit
If you request a credit refund from your energy supplier and they do not action it, you should raise a complaint. You can complain in writing, by email or over the phone. Your supplier has eight weeks in which to respond to and deal with your complaint.
If you are dissatisfied with the outcome of your complaint and no satisfactory response or, indeed, refund of credit has been received within eight weeks, you can then complain to the Energy Ombudsman.
What happens to credit when you switch suppliers?
When you switch energy suppliers, any credit accrued on your energy account should be refunded within 10 working days from a final bill being sent. A final bill should be sent within six weeks of a switch taking place. So if, after 7 weeks and 3 days from the date of the switch you have still not received a refund, your supplier has breached an industry standard and must compensate you.
You should contact your supplier to request a refund and any interest accrued on the credit amount since your account closure. Energy suppliers are not obliged to pay interest. If you’re unhappy with their response, again, raise a complaint with the Energy Ombudsman.