11 Oct 21
This has bought significant issues for the industry because it is not a straightforward process. It is actually very complex and there is a need to engage an expert or educate yourselves to avoid ‘Waste’ or dare I say ‘Mistakes’.
There are the Big Six suppliers in the UK and according to my friend ‘Wikipedia’, they are British Gas, EDF, Eon, Npower, Scottish and SSE, which are all very strong suppliers but have different attributes to the market. There are many more suppliers known in the marketplace that add up to too many more opportunities for confusion. Now all these suppliers provide different services and though they all service your energy requirements the critical measure here has got to be ‘Billing’. Because they all do it differently.
When you are operating a business or buying a house, you need to have a clear understanding of your costs. Now I have said many times that Energy is your third-largest expense, so it is critical for us to understand what our costs are and how this is broken down. Unfortunately, that is not easy because the market is complex and can be confusing even to the experts. However, just breaking it down it to clear areas I believe we can address the confusion.
Billing is where I think and have said before where this all starts. Billing can be based on your contract quarterly or monthly. If this is the case these bills can not be presented unless there is a ‘meter’ reading. Sadly, though not all meters now are read regularly due to security, accessibility and resource to deliver this. Therefore, Best Practice is to always provide the supplier with a ‘Customer Read’ this will ensure you are in line with your billing. This will mean that you may have to pay more but it also means you could be paying less and receive a very big rebate, in the beginning.
When you receive your bills online or by post they will possibly comprise of 4-pages it is important here to ensure that the following details are correct:
• Firstly, you are being billed by the correct supplier (This does happen)
• Check Correct Company Address
• Check Supply Address
• Check Correct Meter Details
• Check Correct VAT Values
• Check Correct set-up on CCL (not all companies need to pay this)
• Check if the Meter reading is (A) Actual (E) Estimated and (C) Customer Read this will be indicated next to the reading
The bill will clearly state the fuel you are purchasing whether it is Gas or Electricity. It is also worth you check the Meter Reference Numbers are correct here too.
Electricity is the Meter Point Administration Number (MPAN) and Gas the Meter Point Reference Number (MPRN) these are abbreviations that we are all too familiar within the industry.
The MPAN is always shown in this format and will be a ‘Unique’ reference number within the industry. You can imagine there are millions of these in the UK. There are systems in place that database them, but they do sometimes get mixed up.
Consumption
On your bill, you will see a Meter reading and if we are discussing Electricity this would be in kWh and this reflects your consumption. This is impacted by how much energy you have used. Therefore, as a very basic indication, would be you have a 3kW Heater in your office or home and you have it turned on for 2 Hours this is how the meter calculates your consumption. (sorry to simplify this).
3kW x 2 Hours = 6kWh so, therefore, consumption would have increased by 6 units.
If this was Gas, then you would see a Cubic Ft or Cubic Meter Reading based on the age of the meter and then there would be a kWh calculation made from Calorific Value, Volume and the actual reading on the meter.
Rate
Electricity:
Your rates on the bill could be Day Rate and a Night Rate (but this does depend on your Tariff structure or contract, but it could look like this –
Day Rate 13p between 07.00 to Midnight and Night Rate 10p Between Midnight and 07.00
Now considering when you had your Electric Fire was turned on then the calculation would be
3kW x 2 Hours 09.00 to 11.00 = 6kWh x 13p