Energy bills explained

What is printed on your energy bill can sometimes be confusing and make it hard to know if you’re paying the correct amount for your gas and electricity.

Here, we set out how to read your bill, how to query any discrepancies with your supplier, as well as how to make sure you’re paying accurately for your energy.

How to read your gas and electricity bill

To keep track of your gas and electricity prices, you need to know how to read your bill. Your bill - whether received monthly or quarterly - contains important information that can be used to check whether you're being charged the right amount by your supplier.

 Below are some of the energy terms you’re likely to find on your bill.

Account Number

Your account number, sometimes referred to as a customer reference number, is a unique string of numbers unique to you and used to identify your personal account details.

Kilowatt-hours (kWh)

A kilowatt-hour is the unit of measurement used to determine how much energy you’ve used. One kilowatt is equal to 1,000 watt hours. So, for example, if you use an appliance rated 1,000 watts for one hour, you will be billed for 1 kilowatt hour (kWh). The unit rate - the price you pay per kWh of energy - will differ depending on your supplier and whether you're on a fixed or standard variable tariff.

Calorific Value

A Calorific Value (CV) is a measurement of the amount of heat energy contained in the gas that’s provided to your home, and is measured in megajoules per cubic meter (MJ/m³).

CV varies throughout the country because of the different sources of gas. The CV in each Local Distribution Zone – the different areas throughout the country where gas is delivered to households and businesses (e.g.,London) - is measured by the National Grid and readings sent daily to your supplier. Your bill will show the CV that has been calculated for your area for that month. Typically, an area has a CV of between 37.5 and 43 MJ/ m³).

Although gas use is recorded by volume in cubic meters (m³), it is converted by your supplier and will appear on your bill in kWh. The CV reading should also appear on your bill.

Standing charge

Also referred to as a daily rate, a standing charge is the daily fee you pay to stay connected to the grid. It also covers other costs incurred by energy companies such as maintenance costs and taking meter readings. The standing charge is payable by all energy customers, and the exact rate you'll pay depends on your supplier, the type of tariff you are on, and where you live.

Dual fuel

Dual fuel means that both your gas and electricity come from the same energy supplier. Some suppliers may offer a discount for customers who choose dual fuel deals.

Charge

The charge listed on your bill is the amount you pay, minus VAT which will be added to the total cost at 5%.

MPAN number

A meter point administration number (MPAN) is the reference number for your electricity meter. Your MPAN can be found on your electricity or dual fuel bill in a box marked ‘Supply Number’. It begins with ‘S’, is 21 digits long and often printed across two rows, but you’ll only need to remember the last 12 or 13 digits which are usually printed in the second row.

MPRN number

Also known as an ‘M number’, MPRN stands for meter point reference number and is a number used to identify the gas meter at your property. Each MPRN is unique and can be found on either your gas or dual fuel bill.  It is between six and ten digits long and will start with an M. E.g. M1970806002.

If your MPRN starts with 74, 75, 76 or 77, your gas is supplied by an Independent Gas Transporter (IGT). Depending on your supplier, “IGT” may also be printed on your gas or dual fuel bill.

What are Independent Gas Transporters (IGTs)?

The majority of the UK is supplied by the National Grid for their gas supply, however some homes and properties will have their gas delivered by an Independent Gas Transporter (IGT).

An IGT is a private company that owns and manages the stretch of pipes that supply gas to your home. 

Meter Readings

Meter readings are the measure of how much gas and electricity you’ve used for the month. To indicate the type of reading that has been taken, your bill will be marked with either a ‘C’, ‘A’, or ‘E’, meaning the following:-

-     ‘C’ (Customer) means you have provided the meter reading to the supplier directly.

-     ‘A’ (Actual) means that this is an actual meter reading taken by your supplier at the time your bill was calculated.

-     ‘E’ (Estimate) means that your bill is an estimate taken by your supplier and based on the energy you’ve used in the past.

If you want to make sure you’re getting the most accurate bills, it’s sensible to take regular meter readings and send these to your energy provider rather than relying on an estimate. This is because if your supplier has estimated too much, you’ll be charged for energy you haven’t used. Conversely, if the estimate is too low, you’ll pay less than you should.

Don’t stay quiet about an under-estimate from your supplier

Although it may be tempting to stay quiet about receiving an energy bill that underestimates your usage, your supplier will eventually get an updated and accurate meter reading, meaning when they do, you’ll need to pay back the difference. This is known as back billing.

What is back-billing?

Back-billing is when your gas or electricity supplier has not accurately billed you for your energy use, resulting in them sending a ‘catch-up’ bill to recover the unpaid amount.

How far back can I be back-billed?

Under back-billing rules set out by energy regulator Ofgem, a supplier can only seek payment for gas and electricity used within the last 12 months if you were billed incorrectly for it. This includes situations where a supplier increases your Direct Debit because it was set too low.

In other words, if you were billed inaccurately for your energy usage, your supplier has 12 months in which to correct this and bill you the actual amount. If this is not done, you can refuse to pay.

However, back-billing rules will not apply if you have been considered to have behaved unreasonably. This includes: -

• Deliberately blocking your supplier from taking accurate meter readings.
• Stealing gas or electricity.

I received a back bill. What should I do?

If you get a bill that’s for more than 12 months ago, the first thing to do is contact your energy supplier.

Explain to them that you are protected by the back-billing rule, and that you cannot be charged for more than one year of energy usage. You should only be charged for any unpaid gas and electricity used within the last 12 months if you have not had an accurate bill for this consumption before. 

Your supplier should send you a new bill for the correct amount. However, if your supplier continues to insist you pay a back bill that is more than 12 months old, you should make a complaint.

Also be aware that, if your supplier sends you a bill charging you for 2 years’ energy use, and you challenge this under back billing rules, although the latter year should be removed, you will still need to pay the bill that accounts for the most recent year.

My bill doesn’t seem right. What can I do?

From receiving an estimated bill based on inaccurate meter readings, to your tariff ending and you falling onto your supplier’s standard variable rate, there can be various reasons why your bill may be incorrect.

It’s important however, that if you do notice something unusual with your bill, to contact your supplier as soon as possible to get an explanation of any discrepancies in charges.

Frequently Asked Questions

I have a prepayment meter. Will I still receive a bill?

If you have a prepayment and not a credit meter, you will not receive a monthly or quarterly bill. With a prepayment meter, energy is provided through the purchase of credit. When this credit runs out, it can be topped-up either in-store or online if you have a prepayment smart meter.

Does the amount of energy I use affect my bills if I pay by direct debit?

If you pay for your energy by direct debit, payments are usually based on an estimate taken by your supplier when you first sign-up. This estimate is the amount of energy your supplier thinks you will use over a year and divided into 12 monthly payments.

However, if your gas and electricity use is more than your supplier initially estimated, these payments may increase.

Does my payment method affect my energy bill?

Yes, your chosen payment method can affect the cost of your energy.

A report conducted by Octopus earlier this year found that a typical UK household that pays their energy bills by cheque, cash, or card are charged up to £254 more per year than those who pay by monthly direct debit.

Although non-direct debit payment methods do incur slight additional costs to energy suppliers, these surcharges are not driven by the rise in energy wholesale prices. Ofgem have said they will clamp down on these charges but not for at least two years. We'd like to see this done much sooner to help bring prices down across the board.

However, until Ofgem takes decisive action, and to avoid these unnecessary charges, setting up a direct debit with your energy supplier can help reduce your bills.

Read your bill and decided you want to switch?

If you’re unhappy with the price on your energy bills, Switchcraft can help. Our service is entirely free and we’ll find you a deal that will keep your energy costs down.