Estimated bills and meter readings for business energy

An estimated bill is not a mistake by itself, it is what your supplier falls back on when it does not have a real reading to work from. The problem comes when estimates run for months without being corrected, especially if your usage has changed and the estimate has not kept up.

This guide explains the rules suppliers have to follow on meter readings and billing, and what to do if an estimate looks wrong.

Why did I get an estimated bill?

Your bill is estimated whenever your supplier does not have an actual reading to bill against, so it works out a figure based on past usage instead. This typically happens because no one has taken a reading recently, your smart or advanced meter is not sending data, or a reading you gave was not accepted as accurate.

Ofgem’s licence conditions require suppliers to take all reasonable steps to obtain a meter reading for every customer at least once a year, whether that reading is transmitted electronically from a smart or advanced meter, taken by a meter reader, or given by you. Between those points, if there is no actual data, the supplier estimates.

How often must my supplier read my meter?

Standard licence condition 21B, which applies to both gas and electricity suppliers, sets out two separate obligations:

• At least one meter reading a year. The supplier must take all reasonable steps to obtain a reading for each customer, from any source it will accept, at least once every 12 months. This does not apply to prepayment meter customers.
• A bill or statement at least twice a year. Suppliers must make a bill or statement of account available to each customer at least twice yearly, and at least quarterly to any customer who asks for it or who has online account management. This does not apply to customers with a prepayment meter, a smart metering system, or an unmetered supply.

The same condition requires suppliers to reflect an accurate reading in your next bill once you give them one, to contact you for a new reading if they think the one you gave is not reasonably accurate, and to explain in plain language how your bill was worked out if you ask. It also bans suppliers from charging you specifically for providing a bill or for access to the consumption data behind it, other than for extra copies of a bill you already have.

How do I give my own meter reading?

Most suppliers let you submit a reading online, by app, by phone, or by email. To make sure it is used:

1. Read the meter correctly. Note only the digits that appear before any that are shown in red, or after the decimal point marker, depending on your meter’s display; a photo of the reading and the meter’s serial number is useful evidence if there is ever a dispute.
2. Send it as soon as you can after your billing date, so it lines up with the period your supplier is about to bill.
3. Keep a copy or a screenshot of what you submitted and when.

If your supplier does not consider your reading reasonably accurate, condition 21B requires it to take all reasonable steps to contact you for a new one, rather than simply discarding it and carrying on estimating.

What should I do if an estimated bill looks too high?

Take an actual reading and send it to your supplier, asking for the bill to be corrected against the real figure. Citizens Advice’s general guidance on high energy bills sets out the same basic fix: if the estimate is too high, a genuine reading lets the supplier send you an updated, accurate bill instead. The most common cause it highlights is simple: if you have not given a reading recently, especially across a season when your usage pattern changes, the estimate can be based on a period that no longer reflects how you are using energy now.

Citizens Advice also recommends sending a reading regularly, for example monthly, specifically to stop bills drifting back onto estimates between supplier-led reads. For a business, that discipline matters more the larger and more variable your energy use is.

Worked example: correcting an estimate

This is a simplified, labelled example to show the shape of a correction rather than real figures from any bill.

Inputs:

• Estimated reading used on your last bill: 12,500 (meter units)
• Actual reading you take today: 12,150 (meter units)
• Difference: the supplier assumed 350 more units of use than you actually had

What happens: because the actual reading is lower than the estimate, your supplier should credit back the difference once it reissues the bill against the real figure. If your actual reading had instead been higher than the estimate, the correction would work the other way, and you would owe the difference. Either way, the principle under condition 21B is the same: once you give a reading your supplier considers reasonably accurate, it must take all reasonable steps to reflect it, rather than carrying the estimate forward.

Getting help if you cannot access or read your meter

If a meter is somewhere hard to reach, or you have a condition that makes reading it difficult, Citizens Advice notes that suppliers offer a Priority Services Register that includes help with meter readings for customers who need it, alongside other support such as accessible communications. This is generally aimed at domestic circumstances, but if a sole trader or home-based business struggles to access a meter, it is worth asking your supplier what support it can offer.

What if the estimate looks too low?

It is tempting to leave a low estimate alone, but this usually just delays a larger correction later, when an actual reading eventually catches the difference up in one go. Depending on how long the underestimate ran and whether the supplier was at fault, this can trigger back-billing. Our guide to back-billing rules explains the 12-month limit that protects domestic customers and microbusinesses from being charged for older, under-billed usage where the supplier was at fault, and where that protection currently stops.

How does this work for gas specifically?

Gas adds an extra layer, because your bill converts your meter reading into kWh using a calorific value and correction factor, and because the industry tracks an Annual Quantity (AQ) for your supply point separately from any single bill. Xoserve, which calculates AQ, explains that it is recalculated from the gas actually used between meter readings, adjusted for the weather experienced, so a long run of estimates can leave your AQ, and the network charges based on it, out of step with your real usage until an actual reading corrects it. If you want to check the underlying conversion yourself, our guide to converting a gas meter reading to kWh sets out the formula suppliers use.

Does a half-hourly or smart meter avoid estimated bills?

Largely, yes. A meter that sends readings automatically removes the need for anyone to visit or for you to submit a reading manually, so estimates should be rare once one is properly installed and communicating. Our guide to half-hourly meters covers how that data flows through to settlement for larger sites, but even a working smart meter can occasionally stop communicating, for example after building work or a change of occupier, so it is still worth checking the reading shown on a bill matches your meter from time to time.

Are estimated bills different from a deemed contract rate?

Yes, and it is worth not confusing the two. An estimated bill still runs under your existing contract’s agreed rates, just against an assumed reading rather than an actual one. A deemed contract is a different situation entirely, where you are using energy with no contract in place at all, for example after moving into new premises without signing a deal, and it is billed at your supplier’s own deemed rates, which are typically much higher than a negotiated contract. Our guide to deemed contracts explains how to spot one and move off it quickly.

Managing meter readings across several sites

If you run more than one site, estimated bills are easier to miss, since a single estimate at one location among several can slip past a routine bill check. Building a simple monthly routine, reading every meter on the same date and logging it centrally, catches this before it becomes months of drift at a site nobody is watching closely. Our guide to multi-site business energy covers this alongside the wider question of managing several contracts and renewal dates together.

What if my supplier will not correct an estimated bill?

If a straightforward request with your own reading does not resolve it:

1. Ask for a written explanation of how the current bill was calculated. Condition 21B entitles you to this in plain, intelligible language.
2. Raise a formal complaint with your supplier if the first request does not fix it, and get a complaint reference number.
3. Escalate to the Energy Ombudsman if you are a micro or small business and the complaint remains unresolved after eight weeks, or your supplier issues a deadlock letter. Our guide to business energy complaints covers this process in full.

Keeping a straightforward record, meter photos with dates, copies of readings you submitted, and your correspondence, makes each of these steps faster. Once your bills are being calculated on actual readings, you can compare business energy quotes with confidence in the usage figures you are working from.

Frequently asked questions