Reference guide — UK energy supply licence
Back-billing rules (SLC 21BA): the 12-month limit explained
A working reference for billing, compliance and revenue-assurance teams at UK energy suppliers: what the rule requires, when the clock starts, where the carve-outs sit, and what evidence you need to be able to produce per account.
What the rule says
Ofgem introduced back-billing protection into the gas and electricity supply licences in its March 2018 licence modification decision (Ofgem decision, 5 March 2018). Under Standard Licence Condition 21BA a supplier must not charge a domestic or micro-business customer for energy consumed more than 12 months before the error was detected, or before an accurate bill for that consumption was issued, where the customer was not correctly billed at the time.
Ofgem sets out the consumer-facing version of the same protection in its guidance on back bills, and reminded suppliers of their SLC 21BA obligations when taking charge-recovery action in its December 2020 open letter.
The five questions suppliers actually ask
- What is the back-billing rule?
- Standard Licence Condition 21BA prevents a licensed supplier from charging a domestic or micro-business customer for gas or electricity used more than 12 months before the error was detected or the accurate bill was issued, where the customer was not correctly billed for that consumption.
- When does the 12-month clock start?
- It runs back from the point the supplier issues the accurate bill or statement of account for the previously unbilled consumption. Consumption older than that window cannot be recovered from the customer where the rule applies.
- Are there exceptions?
- The protection does not apply where the customer has obstructed the supplier, for example by preventing meter access or refusing to provide readings, or in cases involving theft of energy. The supplier must be able to evidence that carve-out, not merely assert it.
- Does the rule cover micro-business customers?
- Yes. The licence condition extends the same 12-month protection to micro-business customers as well as domestic customers.
- How does a supplier prove it complied?
- By being able to show, per account, the date of the last accurate bill, the reading basis for each bill, when the unbilled consumption was detected, and the amount charged inside and outside the 12-month window — with an audit trail that cannot be edited after the fact.
Where the exposure builds up
Accounts with no actual read for over 12 months
A long run of estimates creates an SLC 21B review flag. It does not by itself prove SLC 21BA exposure. That separate review needs bill date, consumption-period and under-billing evidence.
Catch-up bills that reach behind the window
Where a corrected bill covers consumption older than 12 months, the amount outside the window is potentially unrecoverable unless a documented carve-out applies.
Estimated bills issued after an actual read was available
SLC 21B requires bills to reflect actual readings where the supplier holds one. An estimate issued after a valid read is a separate exception, and often the root cause of the back-bill later.
Evidence that survives an audit
A spreadsheet can be edited. An auditor, an Ombudsman case handler or a board will ask how you know the figures were not changed after review.
Important
This page is a plain-language reference, not legal advice, and it is not a determination that any licence breach has occurred. The licence conditions themselves, and Ofgem guidance, are the authoritative source. PowerView output is a triage signal for your own review.
Check your own exposure in 48 hours
PowerView applies separate SLC 21B reading-pattern and SLC 21BA evidence checks to a billing CSV and returns an indicative screening estimate only where sufficient data exists, plus an evidence report with a SHA-256 hash chain an auditor can re-verify. The rule set is published in full on the methodology page before you send a single row of data.