Big change to energy bills that could lower costs for millions of customers delayed AGAIN
A BIG change to energy bill rules that would lower costs for millions of households has been delayed again.
The shake-up is meant to see suppliers tally up customers’ bills every half an hour – but only if they have a smart meter.
Ofgem‘s Market-Wide Half-Hourly Settlement (MHHS) programme was originally meant to come into force in March 2024.
However, this date has now been pushed back to September 2025, meaning customers will have to wait longer to reap the anticipated savings.
Currently, most consumers are billed based on estimated usage profiles, with periodic meter readings used for adjustments.
The MHHS will change this by requiring all electricity suppliers to settle their accounts based on actual half-hourly consumption data obtained from smart meters.
Ofgem projects that once the change is implemented, it will save all households with smart meters an estimated £214million annually, equating to roughly £6 per household if the savings are distributed equally.
The aim of the MHHS is to equalise the prices that energy companies and consumers pay for electricity.
This is due to the fact that the cost energy companies incur for electricity from providers fluctuates every half hour.
However, these frequent price changes are not always mirrored in consumer bills, as many energy companies update their billing less frequently.
Commenting on the delay to the reforms, the energy regulator said: “Ofgem is extremely disappointed that such a significant delay has proved to be necessary.
“MHHS remains a high priority for Ofgem and the government as a means of enabling the lowest-cost decarbonisation of the energy sector.
“MHHS participants must comply with the revised MHHS implementation timetable and ensure the earliest possible delivery of MHHS-related benefits to consumers.”
How will it cut my bills?
The half-hourly settlement, facilitated by smart meters, will end estimated billing and introduce time-of-use tariffs.
This means you’ll pay for the electricity you use at prices that reflect the real-time generation cost.
It will also allow customers to easily reap more savings when they shift their energy use to off-peak times (when demand and prices are lower).
However, it’s important to note that customers who do not have a smart meter won’t benefit from the changes.
SMART METERS
SMART meters were first introduced to homes in 2011, with the government initially aiming to install one in every UK home by 2020.
This deadline has since been extended to 2025.
The gadgets are designed to eliminate the need for traditional meter readings, providing more accurate billing based on actual usage rather than estimates.
They also enable users to monitor their energy consumption at various times of the day and night.
An in-home display is also usually provided, which connects to the meter and shows your energy usage and the cost in pounds and pence.
What if my smart meter isn’t working?
Those with faulty smart meters operating in “dumb mode” will also struggle to access the savings provided through this scheme.
Devices in “dumb mode” don’t automatically share your meter readings with your energy supplier.
This means that you could be billed inaccurately for your usage unless you’re submitting regular meter readings.
According to figures published by the Department for Energy Security and Net Zero (DESNZ) last month, approximately 3.8 million smart meters were not operating correctly in September 2024.
Customers have reported receiving massive bills due to faulty meters.
In November, Sun Money highlighted one of the unusual reasons why your smart meter might be operating in “dumb” mode.
If your energy supplier won’t agree to fix your faulty device, we recommend submitting a formal complaint.
How do I complain about my energy supplier?
SIMILAR to financial services firms, energy companies have to have a complaints procedure for customers to follow.
When you make a complaint, follow this procedure so they have the information they need to resolve the issue.
Explain the problem and what you want your supplier to do about it.
Check your energy supplier’s website for an explanation of how to launch a complaint.
Energy suppliers have eight weeks to respond and come to a decision.
If it doesn’t or you’re unhappy with the response, you can take the firm to the Energy Ombudsman.
The Energy Ombudsman may be able to help if you have a complaint about an energy or communications provider.
Before submitting your complaint to it, you must have logged a formal complaint with your provider and worked with the firm to resolve it.
You must also have received a so-called deadlock letter, where the provider refers your complaint to the Energy Ombudsman.
You can also complain if you haven’t had a satisfactory solution to your problem within eight weeks.
The Energy Ombudsman then bases its decision on the evidence you and the company submit.
If you choose to accept its decision, your supplier then has 28 days to comply.
The Ombudsman’s decisions are binding on the energy company.
If your supplier refuses to follow the instructions, the Ombudsman may contact Ofgem to remedy the situation, but there’s no set period for escalating issues to the regulator, and it’s not up to the customer.
If an individual chooses not to accept the Ombudsman’s final decision, they lose the right to the resolution offer.
Customers still have the right to take their complaint further through the courts.
But remember, this can be a costly and lengthy exercise, so it’s worth thinking carefully before taking this step.