Back-billing of energy bills could 'cripple' small business
Thousands of small businesses could be hit by ruinous energy bills after being under-charged for years by their supplier.
Consumer Focus says that energy back-billing is an issue that has not been tackled by regulatory bodies or government and companies can get hit by back-dated bills totalling thousands of pounds.
Last year, Consumer Direct's helpline received 1,848 complaints from microbusinesses who received unexpected bills after their energy charges were underestimated.
Consumer Direct figures also show that 40% of all complaints received from small businesses about their energy bills are on back-billing.
The problem is compounded as energy suppliers can back-bill businesses for up to six-years of usage, compared to just one year for domestic customers, and can demand instant repayment.
Consumer Focus is calling on energy suppliers to give small business the same protection that consumers are afforded.
The organisation wants energy suppliers to back a voluntary code of practice where very small businesses can only be back-billed for one year when the supplier is at fault.
It is also asking for suppliers to take into account the businesses' ability to pay the debt setting a realistic timescale for repayment, rather than demanding full payment immediately.
Consumer Focus head of energy, Audrey Gallacher, said: "Small businesses need all the help they can get in these difficult times if they are to help drive the economic growth we need.
"Getting a bill for thousands of pounds out of the blue is a nightmare scenario for any small business, especially in these difficult times.
"With suppliers able to go back six years, supplier mistakes can add up to big debts that could potentially cripple some firms.
"The back-billing code of practice would protect firms from large unexpected bills, and give suppliers the incentive to get billing right first time, every time." Alison Brown