What’s An Erroneous Transfer?

Receiving a goodbye letter from your energy supplier or a bill from one that you don’t recognise when you haven’t requested any changes can be disconcerting. How on earth could this have happened? Am I a victim of identity theft or some other type of fraud? 

Well, there’s no need to panic. When this happens, it’s called an ‘erroneous transfer’, and the good news is that it is usually just an error rather than anything nefarious. But it is important that you understand this potential issue regardless since it really does need to be rectified as soon as possible. 

What is an Erroneous Transfer?

An erroneous transfer occurs when an energy supplier erroneously transfers your account from one company to another. There are various scenarios in which this might happen, but the important thing to remember is that under normal circumstances, a supply cannot be transferred without the express permission of the account holder. 

Reasons for an Erroneous Transfer

The main reasons why an erroneous transfer might take place can be summarised as follows: 

• Your details have become confused with someone else’s - this is particularly likely to occur if you live in a flat or new-build property.

• Human error: For example, if someone accidentally selects the wrong address from a drop-down menu, the wrong account details could be applied to the wrong address. 

• A computer system error. 

• Someone is using your property to commit fraud.

• Your meter isn’t labelled correctly in the national database. 

How Does an Erroneous Transfer Happen?

The most common way you’ll find out that an erroneous transfer has occurred will be an unexpected letter or email from your energy supplier which says something along the lines of “Sorry you’re leaving”. You may also receive a final bill when you didn’t request one. In this eventuality, you must immediately contact the old or the new supplier. The best way to do this is usually by telephone; the supplier’s number should be on any letter, statement or bill they send you, along with the reference number you need. 

If you haven’t been near your energy supply's mechanics recently, the most common explanation is a mix-up of reference numbers or address details. When a new property is built, the meter's MPRN (for gas) and/or MPAN (for electricity) registration details can be recorded inaccurately. This is a common scenario for a block of flats or offices that contain numerous gas and electricity meters. It could also be caused by human error by another person or business, for example, selecting your supply point and signing up for a switch, or due to an error made by a business energy supplier.

How Long Does an Erroneous Transfer Take to Resolve?

How long an erroneous transfer takes to resolve will depend on the circumstances that led to it in the first place. Once you’ve contacted the supplier, they should write to you within five working days to explain what they plan to do and when, and then have 20 working days to confirm they’re reversing the switch or explain why it was correct. Your old supplier should switch you back within 21 working days of the date they agree a mistake was made. It should also be noted that the process for this can take substantially longer, especially for business accounts. It will typically take up to 12 weeks to resolve such a query. 

Ofgem Erroneous Transfer Rules

Ofgem, the Office of Gas and Electricity Markets, established regulations to protect consumers from erroneous transfers at the start of 2002, with the energy companies themselves all agreeing to adhere to them. These regulations ensure that such errors are corrected promptly and that customers are compensated for any inconvenience. The current rules also provide a mechanism for customers to lodge complaints and for the authorities to investigate potential violations. These measures are in place to ensure that customers are provided with the best possible service, and include:

• Mandatory Requirements for Suppliers: The Erroneous Transfer Customer Charter imposes mandatory requirements on energy suppliers to protect consumers who have been erroneously transferred. Suppliers must take immediate action to rectify the error and return the customer to their original supplier.

• Automatic Compensation: Domestic customers are entitled to automatic compensation if they are found to be victims of erroneous transfers

• Prevention Measures: Suppliers are obligated to avoid erroneous transfers by ensuring a valid contract is in place with the customer before initiating a switch.

• Timely Resolution: The regulations require suppliers to resolve erroneous transfers within a specific timeframe to minimise disruption to the customer.

• Customer Support: Suppliers must clearly communicate and support customers affected by erroneous transfers, ensuring they are informed about the steps being taken to resolve the issue.

Erroneous Transfer Compensation

This compensation starts at £30 but can reach £120 if the supply is not restored to the correct supplier in a timely manner. Customers will also be entitled to a £30 payment if their previous supplier is late in refunding them their credit balance after they have switched.

Under Ofgem’s rules, suppliers must refund these credit balances within ten working days of issuing a final bill. Suppliers are required to automatically pay compensation to the affected customer within ten working days of the breach. If they fail to make the initial payment, they will be required to pay a further £30.

What to do if Your Energy Supplier Has Been Changed Without Permission

If your energy supplier has been changed without the account holder's permission, it is recommended that you keep records of all telephone conversations. You should also notify both the new and former suppliers. Should you be unhappy with the response you receive from the suppliers, you can escalate a formal complaint to both the suppliers and the regulator, Ofgem. 

Erroneous Transfer Complaint Letter

Citizens Advice has a complaint letter template on its website that you can tailor to the specifics of your circumstances. Whether you’re choosing to use a template or write it yourself, you must include: 

• Your name, business address and a contact telephone number and email address. 

• The date of your complaint. 

• The type of energy being referred to (or both, if both).

• Your new and old energy account reference numbers.

• Serial numbers for the meters involved. 

As with any complaint letter, it’s best to be polite but firm. Energy companies are required to reply within five working days, and it doesn’t hurt to remind them!

Erroneous Transfer Time Limit

If you've been the victim of an erroneous energy supply transfer, your old supplier has 21 working days to switch you back, and your new supplier has ten working days to pay you £30 in compensation. 

Here are some other things to know about erroneous transfers: 

• You'll still receive bills from your old supplier while you're switched back. 

• You can check if you've been the victim of an erroneous transfer by comparing the supply numbers on your recent bills to the numbers on your welcome letter or first bill from your new supplier. 

• Your new supplier will automatically pay you the compensation by cheque or direct bank transfer. 

• If the supplier fails to send the 20 working day letter within 20 working days, they will pay you £30. 

• If your old supplier fails to re-register you within 21 working days, you'll receive £30 from them.

The Energy Ombudsman aims to help resolve problems between customers and suppliers or certain network operators. On its website, the Ombudsman lists the network operators with whom it can review disputes.

You can complain to the Energy Ombudsman if:

• A problem you reported to your supplier or network operator has not been fixed within eight weeks.

• You receive a “deadlock letter” stating your problem cannot be fixed.

• You’re not happy with the response you have received.

• Suppliers and network operators must perform the actions listed in the Ombudsman’s decision. These actions can include fixing your problem, explaining what happened or paying compensation.

Ofgem is independent from the Energy Ombudsman and does not get involved in investigations or decisions that the Ombudsman makes. If you are unhappy with the Ombudsman’s decision, they will tell you what to do next. 

In a competitive marketplace within a complex sector, accidents are likely when switching from one energy provider to another. Erroneous transfers are never ideal, but most can be resolved quickly, and only a small proportion result from attempted fraud. Stay informed about your rights and the regulations surrounding this, and you’ll do what you can to prevent it from happening to your business.