Scottish power reclaiming over £4000 for putting us on wrong tariff

devilchef
devilchef Posts: 235
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edited 28 December 2013 at 3:53PM in Energy
Hi all MSE's,
It has come to our attention after being with Scottish power as a small business for over 5 years, we have been under charged for 5 years and now they would like to reclaim a years worth back to the value of over £4000. I should say that they have written to us to tell us that we had been put on the wrong tariff all this time. Are they able to try and get this back even though they have admitted it was their fault? Or do i have to repay this amount? I have not received proof from them, they have just sent it in a letter saying that they will take it back in a direct debit in 2 weeks...but no breakdown of any charges that they are reclaiming. As a consumer, is there anything we can do? Any help would be gratefully appreciated.
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  • Cardew
    Cardew Posts: 29,036
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    Are they aware that this is a business account? e.g do you pay 20% VAT?


    With a business account they used to be able claim back for 6 years as the 12 month back-billing rule only applied to domestic accounts.


    That said there have been some recent changes on small(and micro) business accounts that you need to look into; however the protections that apply to domestic accounts don't all apply to business accounts.


    We would need more information to know about the liability issue. If your contract was for Tariff X, and you have been wrongly charged for Tariff Y, then they can claim for the correct tariff. You would have wanted to claim a rebate had you been over-charged.


    You obviously must have full details of why they consider you have been undercharged.
  • They are aware it is a business account (micro-business rates).They said that we have been on the wrong tariff for 5 years but will only re-coup 1 years worth of difference which equates to roughly £4800. I cant understand how this wasn't picked up sooner. Its 5 years ago. I have seen quite a few similar although domestic instances where this has occurred with Scottish power. Under what circumstances are they not able to back date a claim? At the end of the day, they are providing us with a service in which i am the customer and they have admitted about making this mistake which is very costly. They have not set out a re-payment method, just want it in one go which is 2 weeks from the date of the letter (pretty sure it has to be a month). I will sift through all the details when i get back to work later.
  • Cardew
    Cardew Posts: 29,036
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    They can always backdate 12 months even on domestic tariffs - when it is the company's fault.


    They cannot backdate more than 12 months if it is their fault.


    If any company, not just Utility companies, make a mistake and fail to charge, or undercharge, an agreed price for a product/service; they have 6 years in which to claim.


    Claims for gas and electric are included in this, except for domestic or(recently) micro businesses. Water companies will claim back for 6 years.


    Assuming their claim is valid, the mistake is indeed very costly - to Scottish Power!


    You haven't given any details of the undercharging. Were you not aware you were being undercharged? or are you disputing their claim?
  • matelodave
    matelodave Posts: 8,586
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    Were you not checking your energy bills, if so you should have been aware that something wasn't quite right.
    Never under estimate the power of stupid people in large numbers
  • dogshome
    dogshome Posts: 3,877
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    Something I do not understand about this post.

    The supply of Commercial Gas/Elec has been a minefield for small businesses, with Shark brokers signing up customers by phone, hard copies of the verbal contract being 'lost' in the post and the Big 6 joining the feeding frenzy.

    Contracts sold were for a period, (1 year - 2 years - 3years), at the end of which the customer, provided they jumped through a series of complicated hoops, was free to re-negotiate the terms or change supplier, but in all the tales of woe reported by Small Businesses, I've never seen a report of a contract for a 5 year term
  • devilchef
    devilchef Posts: 235
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    I should say after looking at the letter a bit more closely, its not the wrong tariff, the tariff hasn't changed however we have been told that the price on the tariff was wrong and that it should have been higher. I should also say that this only came to light as we told Scottish power that we were going to leave them and join another company.
  • dogshome
    dogshome Posts: 3,877
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    Business supply utility contracts are individually negotiated between supplier and customer, there are no wrong or right prices

    The negotiated contract lists the cost per Kwh for Elec & Gas, and that is the price till the contracts End or Review date.
    If the contract says one price, but the supplier has issued bills at a lower price in error, then the supplier can back-bill for the difference

    However the supplier cannot adjust the contract stated price at a whim - If they find themselves commited to a too lowly price on the contract they can negotiate with the customer on the price of future supplies, but cannot simply demand they are paid more than the contract price for supplies already delivered
  • devilchef
    devilchef Posts: 235
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    dogshome wrote: »
    Business supply utility contracts are individually negotiated between supplier and customer, there are no wrong or right prices

    The negotiated contract lists the cost per Kwh for Elec & Gas, and that is the price till the contracts End or Review date.
    If the contract says one price, but the supplier has issued bills at a lower price in error, then the supplier can back-bill for the difference

    However the supplier cannot adjust the contract stated price at a whim - If they find themselves committed to a too lowly price on the contract they can negotiate with the customer on the price of future supplies, but cannot simply demand they are paid more than the contract price for supplies already delivered

    I believe it is the latter. How can i word this to SS and is there like a law to back up what you have said, ie: cannot demand they are paid more than the contract price for supplies already delivered?. This is very interesting but would like some kind of reference on what you have said or a way to back it up (without being disrespectful to yourself for your advice!)
  • devilchef
    devilchef Posts: 235
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    Cardew wrote: »
    They can always backdate 12 months even on domestic tariffs - when it is the company's fault.
    They cannot backdate more than 12 months if it is their fault.
    If any company, not just Utility companies, make a mistake and fail to charge, or undercharge, an agreed price for a product/service; they have 6 years in which to claim.
    Claims for gas and electric are included in this, except for domestic or(recently) micro businesses. Water companies will claim back for 6 years.
    Assuming their claim is valid, the mistake is indeed very costly - to Scottish Power!
    You haven't given any details of the undercharging. Were you not aware you were being undercharged? or are you disputing their claim?
    First of all, it states on our bill..Micro business. Secondly we had no idea of being under charged whatsoever until receiving the massive bill because we decided to move companies. I have been with SP for 5 or 6 years and they renew the contract etc but nothing has ever been picked up by them. Is there any reference material available with regards what you have said "Claims for gas and electric are included in this, except for domestic or(recently) micro businesses. Water companies will claim back for 6 years.
    Assuming their claim is valid, the mistake is indeed very costly - to Scottish Power!"? Not disputing your knowledge but SP will lol. Any reference mat would be a great advantage.
  • Cardew
    Cardew Posts: 29,036
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    devilchef wrote: »
    First of all, it states on our bill..Micro business. Secondly we had no idea of being under charged whatsoever until receiving the massive bill because we decided to move companies. I have been with SP for 5 or 6 years and they renew the contract etc but nothing has ever been picked up by them. Is there any reference material available with regards what you have said "Claims for gas and electric are included in this, except for domestic or(recently) micro businesses. Water companies will claim back for 6 years.
    Assuming their claim is valid, the mistake is indeed very costly - to Scottish Power!"? Not disputing your knowledge but SP will lol. Any reference mat would be a great advantage.


    You need to read up on Statute of Limitations


    http://www.hmrc.gov.uk/manuals/ihtmanual/ihtm28384.htm


    Nobody here can help you unless you give some clear information about SP's claim.
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