A code of conduct introduced by energy suppliers to protect customers from billing errors has been exposed as a sham, after an electricity consumer who paid all bills in full and on time for seven years has been charged with an “underpayment” of more than £19,000.

Adam Laurie, above, who is renovating a house in Dorset with his wife, has been told to pay up even though the energy supplier EDF Energy admits that it ignored its own meter readings and supplied erroneous bills.

Mr Laurie argues that according to the Energy Retail Association (ERA) code of practice for accurate bills, intended to help victims of errors, he should be required to pay only one year of the supposed arrears instead of seven.

However, a loophole in the code means that the company is refusing to back down, claiming that it is not in breach because the wording requires only that energy companies supply regular bills — but not accurate ones.

Audrey Gallacher, an energy expert at Consumer Focus, the independent consumer body, says: “Sadly we are not surprised by this issue, as we have heard of other problems with EDF’s interpretation of the Energy Retail Association’s code of practice.

“Due to poor customer experiences, we are working with Ofgem and the Energy Retail Association to clarify the code of practice on accurate billing and how it should be implemented.”

The outcome of Mr Laurie’s fight will have implications for millions of people who suffer as a result of poor administration by energy companies. Almost nine million households have had to deal with at least one inaccurate energy bill in the past two years, while nearly a quarter had to contend with inaccuracies more than once, according to uSwitch.com, the comparison website.

Most of the billing blunders are the result of technology failures or human error, as more than half of power company bills are estimated.

Ann Robinson, of uSwitch, says: “The energy industry’s reputation for accuracy is suffering because it is still relying on an estimated billing system. This can leave people unexpectedly out of pocket and damage their confidence in their supplier.”

Mr Laurie, an IT consultant, said that he was “dumbstruck” when he received the demand for seven years of backpayments and furious when EDF refused to back down.

“When they hit me with this bill, I nearly had a heart attack,” he said. “I thought there had to be a simple mistake at first. I knew that some of my bills had been estimates but that didn’t worry me because the meter had been read periodically. Then they said, ‘No, this is for real’.”

The Lauries moved into their home, a rambling semi-derelict country house near Dorchester, in 2002. Because they are slowly rebuilding it, only a three-bedroom flat on an upper floor was connected to the electricity supply during the years in question. In recent years quarterly bills had ranged from £326 to £100.

“That was about the same as our old house,” Mr Laurie said. “In fact, we thought it was so reasonable that we invested £20,000 in an electrical heating system for the whole house. Boy, do we regret that now.”

The £19,000 bill for the backpayments came almost a year ago and Mr Laurie challenged it immediately and sought advice from independent electrical contractors.

“The electricians have measured the power being drawn on all internal circuits and they say it’s normal for a house but does not tally with what the meter is showing,” he said.

“Someone visited from EDF a couple of weeks ago to warn us we were about to be disconnected. Even he said that our usage didn’t make sense and that we were apparently pulling enough power to run a small factory, not a three-bedroom flat. This means either something is faulty or the meter is reading incorrectly.

“All we have in the flat is an electrical heating and water system, a TV and a couple of computers. There’s nothing there that would eat up so much power.”

Despite Mr Laurie’s protests, EDF insists that the bill is now correct and that the estimates it made over seven years were wrong.

The company, along with British Gas, npower, E.ON and Scottish Power, is a signatory to the voluntary ERA code of practice, introduced in full in January 2007. At its centre is a pledge to protect consumers by limiting backdating of incorrect bills to no more than one year. When Mr Laurie pointed this out, EDF said: “EDF is not in breach of the billing codes as we have sent you bills for the whole period we have supplied you . . . We accept that meter readings taken by our representatives were not used to bill you, resulting in you receiving significantly underestimated bills, but these errors do not mean we are in breach of the billing code.”

Bizarrely, EDF is correct to the letter of the law because it can be interpreted as meaning that companies are at fault only if they fail to bill for two years. The relevant part of the code, section 10, says: “If your supplier is at fault, and you do not receive a bill for more than two years, then from July 2006 any outstanding debt that relates to energy consumed more than two years ago will be cancelled. From July 2007, this will reduce to one year.”

Mr Laurie said: “EDF is reading into this that it is only at fault if it doesn’t send a bill out for two years. So long as it keeps sending out bills, no matter how inaccurate they are, then it isn’t at fault. It’s unbelievable.”

EDF told The Times: “EDF Energy is not responsible for the wording of the billing code or how it is enforced, and any issues regarding the code would need to be taken up with the Energy Retail Association.”

The ERA said it was concerned with “accuracy of bills, timeliness of billing, and good customer service” but could not comment on individual cases.

However, two separate studies published this week suggest that reform of the billing system is long overdue.Three quarters of respondents to a survey by uSwitch said that energy bills were too complicated. About 40 per cent said that they couldn’t work out how their bills were calculated from the information on their statement.

Ms Robinson says: “A well-written, clear and concise bill should leave consumers feeling empowered and in control, not bemused.” Energy companies were also urged to improve complaint handling procedures after Ofgem, the energy regulator, said that one in four customers was unhappy with how grievances were dealt with.

The regulator said there were “low levels” of satisfaction across all suppliers — with billing and prices the most common grievance — but added that some performed better than others.

Scottish and Southern Energy and E.ON rated joint highest, with 29 per cent of customers satisfied, while npower was lowest, with 16 per cent. ScottishPower recorded 24 per cent, while Centrica and EDF Energy each polled 20 per cent in the survey of 2,700 customers.

In a letter sent to bosses of each of the main energy companies, the Ofgem chief executive Alistair Buchanan said: “It is in suppliers’ best interests to ensure that the service they provide is of a high standard. This is clearly an opportunity for them to raise the bar.”

Mr Laurie has taken his case to the Energy Ombudsman. A ruling is expected within weeks.