Bill validation sounds straightforward. Open the bill, check the numbers, move on. In practice, it's the task that eats your afternoon and still leaves you wondering if you missed something.
Here's how to validate energy bills properly — and where the manual process starts breaking down.
Step 1: Gather the contract
Before you touch the bill, you need the contract. Not a summary, not what you remember from the renewal call. The actual signed contract showing:
- Agreed unit rate (p/kWh)
- Standing charge (p/day)
- Contract start and end dates
- VAT eligibility
- CCL status
- Any pass-through charges or additional levies
If you can't find the contract, request a copy from the supplier. You can't validate a bill without knowing what was agreed.
Step 2: Check the unit rate
This is where the money is. Compare the billed unit rate against the contracted rate. They should match exactly. If they don't, you've found an error.
Common reasons they won't match:
- The supplier applied a rate change on the wrong date
- The wrong tariff code was assigned to the meter
- A mid-contract rate adjustment wasn't processed correctly
Even a 0.5p/kWh difference on a business using 100,000 kWh per year is £500. On larger sites, it runs into thousands.
Step 3: Check the standing charge
Compare the daily standing charge on the bill against the contract. This one's easy to overlook because the daily amount is small, but it compounds across the billing period and across the year.
Step 4: Verify consumption
Look at the billed consumption figure. Is it based on an actual meter read or an estimate? If it's estimated, how long has it been since the last actual read?
Estimated reads that run for multiple billing cycles tend to drift. If the supplier has been overestimating consumption, your client is overpaying. If they've been underestimating, a catch-up bill is coming.
Check whether the consumption figure looks reasonable compared to the same period last year. A 30% spike with no obvious explanation is worth investigating.
Step 5: Check VAT
Businesses that use less than 1,000 kWh of electricity per month or 4,397 kWh of gas per month qualify for the reduced 5% VAT rate instead of 20%. Many qualifying businesses are charged the full rate because nobody flagged the eligibility.
Check the monthly consumption against the threshold. If your client qualifies, make sure the bill reflects it.
Step 6: Check CCL
The Climate Change Levy applies to most business energy consumption, but some organisations are exempt — charities, businesses with Climate Change Agreements, and very small consumers. If your client is exempt, verify that CCL isn't being charged.
Step 7: Check the billing period
Make sure the billing period doesn't overlap with a previous bill and doesn't leave a gap. Overlapping periods mean double-charging. Gaps mean consumption is going unbilled and will likely appear as a catch-up charge later.
When manual checking breaks down
If you're managing a handful of clients, the steps above are workable. Time-consuming, but workable. The problem is scale.
A broker with 200 clients, each receiving quarterly gas and electricity bills, is looking at 1,600 bills per year. At 20 minutes per bill, that's over 530 hours — more than a quarter of a full-time role.
Most brokers don't have that capacity. So they check the ones that look wrong, spot-check a few others, and let the rest through. That's where errors slip past and money gets left on the table.
The software alternative
Automated bill validation does steps 1-7 on every bill, every time, in seconds. Clean bills pass through. Errors get flagged with the specific charge, the financial impact, and a drafted supplier query.
Your team's role shifts from checking every bill to reviewing only the flagged ones. That's a better use of their time and catches errors that manual checking misses.
For a comparison of the two approaches, see automated bill validation vs manual checking. Or if you want to see how validation software handles this in practice, try Edge free and run your first 10 bills through.