Questions of Cash: Extra Energy's estimate bills soar away from reality

One Independent reader's estimated gas use for the year was increased by 368 per cent

The lights were on but no one was home as Extra Energy failed to change an inflated bill (Getty Images)

Q. I live with my husband and two children in a 10-year-old terraced house with double glazing, solar panels and LED lights. I buy energy from Extra Energy, paying £100 per month by direct debit. This is based on my energy usage for previous years (4,229kwh electricity and 18,955kwh for gas). I give the company meter readings and a meter reader sometimes comes round.

On 24 September, Extra Energy sent me a dual-fuel statement for gas and electricity used, raising my payment to £393 a month. My estimated gas use for the year had been increased by 368 per cent.

I contacted Extra Energy, which said it was a computer glitch that would be sorted out. I then received a revised statement, saying my new bill would be £360 a month.

I phoned again and was told by the operative that the computer problem was continuing, but that she would change the monthly payment to £125. When I checked Extra Energy's website, I found it continued to say that I would pay £360 a month.

I emailed the company twice, but got no response. Now £360 has been taken from my bank account and my account with Extra Energy is £537.79 in credit.

As a result, I am going to switch suppliers, but I do not see why I must pay exit charges as the situation is not my fault. JE, Cambridge

A. Extra Energy says the fault lies with the gas wholesaler, not with it. An "annual quantity" estimate for your consumption had been provided to Extra Energy, which led to the increase in the charge. It promises to reimburse your overpayment and will not impose an exit penalty if you close your account.

Ben Jones, managing director of Extra Energy, said: "When a customer switches, their new energy supplier relies on readings provided by the independent gas transporter, and the direct debit is calculated from this information. In this case the figure provided was incorrect, which unfortunately meant that [the reader] had a higher gas bill than she should have.

"As soon as we were made aware of the problem, we amended her direct debit and will reimburse her for any mispayments."

Another blown fuse at Extra Energy

Q. I moved to a new fixed- price dual-fuel tariff with Extra Energy on 1 October, following the expiry of my previous deal. The document forming the basis of the contract estimated my annual dual-fuel costs at £1,541, equal to £128 per month. This estimate was in line with my previous usage. I accepted this contract.

Meter readings on 30 September indicated a £24 debit to carry forward. A downloaded account then told me my monthly payment would be £157.

Having queried this, I was informed by email that a recalculation had now fixed my payment at £129. On 14 October, however, £182 was taken from my current account by direct debit.

I have tried to discuss this with Extra Energy, but received no response. MG, Derbyshire

A. Extra Energy's Mr Jones said: "Customer service is our number one priority and I recognise that the service [the reader] received does not meet the high standards we expect at Extra Energy. We're growing fast and unfortunately this meant that [the reader's] direct debit was not updated, based on his meter readings, quickly enough."

Other Palestine groups have accounts closed

Q. The Co-operative Bank explained it has closed the bank accounts of Palestinian support groups in order to comply with money laundering regulations (see Questions of Cash, 21 November). Those groups are engaged in poverty alleviation in Palestine.

I am involved with the Palestinian Solidarity Campaign, and our local groups – which do not send money abroad – have also had their bank accounts closed down by the Co-operative Bank. Some of them have had accounts with the bank for many years.

The Boycott Israel Campaign and the Cuba Solidarity Campaign have also had their accounts closed – and do not send money abroad. JN, Manchester

A. A spokesman for the Co-op Bank provided a clarification of his previous remarks.

He said: "As previously advised, for customers who operate in, or send money to, high-risk locations throughout the world, advanced due diligence checks are required by all banks to ensure that funds do not inadvertently fund illegal or other proscribed activities.

"Although some charities may not make direct payments to higher-risk locations, their activities and payments may be linked directly to other organisations that do send money internationally."

The bank asked us to include an additional statement. "This is not a reflection on the excellent work carried out by many organisations throughout the world, or a statement about the causes they support," said the bank. "We remain a committed supporter of charities which can meet the industry-level requirements."