Back-billing: when a supplier cannot charge you for old energy
Few things worry a treasurer more than a sudden catch-up bill for thousands of pounds. It usually follows months or years of estimated readings, a meter that was never read, or an account that was simply not billed. The supplier then calculates what it says you owe and asks for it all at once.
You may not have to pay all of it.
The twelve-month rule
Under Ofgem's back-billing rules (Standard Licence Condition 21BA), a supplier generally cannot bill you for energy used more than twelve months before the bill was issued, where the delay was its own fault. If your supplier failed to bill you correctly, it can usually only recover the most recent twelve months of charges.
The rule does not apply if the delay was caused by you, for example if you refused access to the meter or behaved obstructively. Simply not chasing a missing bill does not normally count against you.
Who is protected
The twelve-month limit applies to domestic customers and microbusinesses. You count as a microbusiness if you meet any one of these tests: you use no more than 100,000 kWh of electricity a year, or no more than 293,000 kWh of gas a year, or you have fewer than 10 full-time-equivalent employees and a turnover or balance sheet of no more than €2 million. Most churches, mosques, gurdwaras and smaller faith charities qualify on energy use alone.
Larger organisations are not automatically covered by the cap. Even so, a bill based on an estimate that doesn't match your actual meter readings can still be challenged.
Check the bill itself
Back-billing is only part of the picture. Catch-up bills are often built on an estimated opening reading that overstates what you actually used. They may also carry 20% VAT and the Climate Change Levy when a place of worship should be on the reduced rate with no levy. When the underlying bill is wrong, the back-billed amount is wrong too. See how we resolved exactly this for one church.
What to do
Don't pay a large unexpected bill until it has been reviewed. Raise a formal complaint with the supplier in writing. If it isn't resolved within eight weeks, you can usually take it to the Energy Ombudsman free of charge. If the supplier sends a “deadlock” letter saying it can do no more, you can go to the Ombudsman straight away, but you must do so within a year of that letter.
We reconstruct your actual consumption from meter readings, check the bill against the rules, and handle the dispute through to resolution.
This article is general guidance based on the rules as at October 2026. It is not legal or tax advice.