Bulk LPG - Cheapest suppliers / supply route?
Comments
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Those graphs are amazing! If someone out there can translate them into English they would be incontovertible evidence that we are being taken for a rather expensive ride!
Well done thozza!!!:T0 -
Brilliant info on the graphs. Thanks a lot for finding that.
Remains to be seen if anyone can make good use of the info in shooting down some of the big suppliers.0 -
Hi All
Just renewing my domestic LPG contract & found this fourm - very useful.
Watch out for Calor though. I've just been sent a quote for a "capped" price contract:
- 44p/litre fixed for 9 months
- £200 cashback on my account
- Tanks standing charge remains same at 24p/day (underground tank)
- If price goes up by 3.5p/liter or more in any 3 month period I can trerminate the contract & go elsewhere.
The sales guy even kindly highlighted the relevant sentecne in the T&Cs re the 3.5p increase/termination clause.
What he didn't highlight was the next sentence that says "In the event of such termination you will pay the tank uplift charge.." which when you go to the relevent section turns out to be £1,100 + VAT!
I haven't done the maths but the price would have to go up by a massive amount to offset this charge so the "anything more that 3.5p increase and you can terminate" sales pitch is very hollow.
The Calor deal is strill pretty attractive (I'm currently paying a whopping 59p/liter) & I'll probably go with it. Just wanted to make sure others were aware of this "penalty".
Mover0 -
Just renewing my domestic LPG contract & found this fourm - very useful.
Watch out for Calor though. <snip>
- If price goes up by 3.5p/liter or more in any 3 month period I can trerminate the contract & go elsewhere.
The sales guy even kindly highlighted the relevant sentecne in the T&Cs re the 3.5p increase/termination clause.
What he didn't highlight was the next sentence that says "In the event of such termination you will pay the tank uplift charge.." which when you go to the relevent section turns out to be £1,100 + VAT!
<snip>
Welcome to the forum.
Thank you very much for highlighting this uplift charge. I was told about it some months ago - but this was second hand info so didn't post.
Please could you send a copy of the offer from Calor - and a copy of the contract - to the Office for Fair Trading, specifically to Sharon Dias [EMAIL="sharon.dias@oft.gsi.gov.uk"]sharon.dias@oft.gsi.gov.uk[/EMAIL] . I think she would be very interested. And tell her about the spiel from the "sales' guy".
I wonder whether this clause falls foul of the Unfair Trading Regulations 2008 (this post is about prices but there's a further link in the post) or Unfair Terms in Consumer Contracts Regs 1999 (see here) as the break clauses in the contract seem unduly weighted in the supplier's (i.e Calor's) favour. Basically your option to get out of the contract because of price rises is no option, financially (as you suggest)
See clause 18.1.3:
18.1.3 These objections are less likely to arise if a term is specific and transparent
as to what must be paid and in what circumstances. However, as already
noted, transparency is not necessarily enough on its own to make a term
fair. Fairness requires that the substance of contract terms, not just their
form and the way they are used, shows due regard for the legitimate
interests of consumers. Therefore a term may be clear as to what the
consumer has to pay, but yet be unfair if it amounts to a 'disguised
penalty', that is, a term calculated to make consumers pay excessively for
doing something that would normally be a breach of contract – see
paragraph 5.8.
Again Sharon Dias should be able to inform you!
PS Thanks for making this "very useful" forum even more useful!
..0 -
Tank uplift - £1100- thats pure daft even for an u/g tank.
Sure there was something fairly recently about this charge not being allowed?
Agree completely with Little Vermin, whizz off an e-mail to Sharon Dias at OFT ASAP.0 -
Tank uplift - £1100- thats pure daft even for an u/g tank.
Sure there was something fairly recently about this charge not being allowed?
I quite agree. I too remember reading something quite specific about that recently from the OFT, but like frankie, hanged if I can remember where.
But (unless I am very much mistaken) that is only a contractual scare tactic/let's see if we can get away with it clause anyway (LPG contracts seem to be littered with those).
From the OFT Off Grid Energy market Study Annexes (http://www.oft.gov.uk/shared_oft/market-studies/off-grid/OFT1380annexes.pdf):Key features of the Competition Commission Orders
I.2 The 2008 Order relates only to individual tank customers. It was made by the CC on 13 October 2008 and came into force on 13 April 2009.
I.3 The key features of the 2008 Order include:• That the maximum length of any exclusivity period in a contract must not exceed 24 months; and that any contractual notice period for termination must not exceed 42 days.
• The obligation for a supplier to transfer the existing tank and associated pipe work at the customer's premises into the ownership of a new supplier, upon request by a customer when giving notice of an intention to switch suppliers ('tank transfer'). However, a new supplier is not obliged to purchase the existing supplier's tank as long as he notifies the customer of his decision and the reasons why.
• If an existing supplier and a new supplier cannot agree on the price to be paid for an existing tank then the price shall be determined by a tank valuation formula as specified in the Order.
• If a customer does not want a tank transfer, he can request the existing tank to be removed (uplifted) when giving notice and the existing supplier shall be obliged to do so at no cost to the customer. The new supplier will then be responsible for installing a new tank.
• etc etc
Now, reading that carefully, it makes no distinction as to the nature of the termination, provided that we are talking about a mutually agreed transfer to another supplier (presumably, and quite reasonably, a default by the customer would not be covered by such a contract termination). Whether the customer attains that right through expiry of the 24-month exclusivity period, due to an excessive price rise or other fundamental breach or failure by his supplier is immaterial.
I totally agree with LittleVermin and frankie - it's vitally important that this is clearly pointed out to the OFT - Sharon Dias is the contact: sharon.dias@oft.gsi.gov.uk
Remember, the OFT are scrutinising LPG contracts following their Off-Grid Energy Study of 2011and this is exactly the sort of egregious nonsense they need to be stamping on (and, in my opinion, censuring and penalising suppliers for)0 -
I quite agree. I too remember reading something quite specific about that recently from the OFT, but like frankie, hanged if I can remember where.
<snip>
from http://www.oft.gov.uk/shared_oft/monopolies/lpg-note.pdf (Explanatory note re Competition Commission Domestic Bulk LP Gas Order):
..Tank uplift charges
35. Article 13 provides that the existing supplier shall not impose upon the customer or the new supplier any charge directly referable to cost of the tank uplift. The intention of this article is to ensure that the imposition of a charge at the termination of a contract does not act a disincentive on the customer to switch. It does not preclude the supplier from recovering the cost of tank uplift through the charges made for supply of LPG over the course of the contract.
BTW first para of the 'Explanatory note' includes this:
and so the CC took action to increase competition.In summary, the report set out the CC’s findings that there are features of the markets for the supply of domestic bulk liquefied petroleum gas (LPG) in Great Britain and Northern Ireland which adversely affect competition
My understanding (OK, second-hand info) is that this clause in Calor's contract about the penalty for uplift is a NEW feature! So after CC had sorted out some anti-competitive features with its 2006 Order .... a major supplier produces a new feature to decrease competition!
Again, info to Sharon Dias at OFT, please!0 -
Hi Everyone
Thanks for your very useful info & contributions.
I have taken your advice and mailed Sharon Dias @ OFT and am awaiting a response.
In the meantime I spoke to Calor & armed with your citations challenged them over this uplift charge.
They immediately said the clause was badly worded and agreed to confirm in writing that termination within contract due to price increase of more that 3.5p does not incur the uplift charge.
As I said i thought the rest of the package compared well to other suppliers so having got this penalty removed/clarified I'll go ahead with Calor.
Many thanks again for your knowledgeable insights & citations
Mover
0 -
<snip>
I have taken your advice and mailed Sharon Dias @ OFT and am awaiting a response.
In the meantime I spoke to Calor & armed with your citations challenged them over this uplift charge.
They immediately said the clause was badly worded and agreed to confirm in writing that termination within contract due to price increase of more that 3.5p does not incur the uplift charge.
As I said i thought the rest of the package compared well to other suppliers so having got this penalty removed/clarified I'll go ahead with Calor.
<snip<snip>
Watch out for Calor though. I've just been sent a quote for a "capped" price contract:
- 44p/litre fixed for 9 months
- £200 cashback on my account
- Tanks standing charge remains same at 24p/day (underground tank)
- If price goes up by 3.5p/liter or more in any 3 month period I can trerminate the contract & go elsewhere.
The sales guy even kindly highlighted the relevant sentecne in the T&Cs re the 3.5p increase/termination clause.
What he didn't highlight was the next sentence that says "In the event of such termination you will pay the tank uplift charge.." which when you go to the relevent section turns out to be £1,100 + VAT!
I haven't done the maths but the price would have to go up by a massive amount to offset this charge so the "anything more that 3.5p increase and you can terminate" sales pitch is very hollow.
The Calor deal is strill pretty attractive (I'm currently paying a whopping 59p/liter) & I'll probably go with it.
Glad Calor backed down! Personally I'd ask them to send a NEW contract - without this clause. If they want to include a clause specifying an uplift charge if you, the user, break the contract with no justification that's fine - and would be very prudent.
Unfortunately they will be sending this contract out to innumerable renewing and potentially new customers.
Thanks for contacting Sharon Dias at OFT. Please post her reply.
With your new contract - with an initial 44ppl guaranteed for 9 months and a max of 3.5ppl rise per 3 months you will effectively agree to be charged a maximum of 58ppl for your last fill. Obviously no-one can predict the wholesale price then - but we do know Calor's (and the other major's) prices rarely, if ever, go down. They offer 'price stability' to the customer they told the Office for Fair Trading as part of their submission for the Off-grid Energy Study. The report includes:
"Suppliers told us that they do not pass on every increase and decrease in input costs, instead trying to minimise the frequency of price changes to the consumer. Data they have provided show that in both GB and NI, retail prices tend to not fluctuate as much as input costs."
I see you write about a "whopping 59ppl" - when the independents which post on-line are currently charging ~ 47-51ppl, and wholesales prices are dropping (see Bloomberg in US $ here and ANSI in ppl here). Can I ask who your present supplier is, please?
Ace Gas Guzzler posted (here) that Calor offered £250, rather than £200, of 'free gas' - worth trying for this? Especially after the hassle they've caused you!
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Hi LittleVermin
Current supplier charging me 59p/liter is Calor
I'm very green to the whole off-grid supply thing & after "automatically" renewing with Calor 2 years ago (completely unaware that you could switch supplier) they seem to have stung me with a high rate.
Sharon Dias replied and clarified that Calor do *not* make the uplift charge for terminating the contract due an above 3.5p increase but she also stated that they were working with Calor & other suppliers to make sure the wording around termination & charges is clearer.Well it couldn't be much more opaque than it currently is
I have to say I was impressed with Sharon speedy response - is the OFT this prompt with every enquiy?
Here's Sharon's reply in full:Thank you for your e-mail below seeking advice on Calor’s terms and conditions of supplying LPG with the ability to cancel the contract should the price increase by more than 3.5p/ litre in any 3 month period.
We understand that Calor does not apply the standard uplift charge in such instances of termination, so long as you are switching to another bulk LPG supplier rather than away from bulk LPG. This is clarified by exceptions that should be set out in the clause 8 to which you refer.
Our recent work <can't post link - sorry> , which should shortly take effect, has sought to make such termination charges in future contracts clearer.
However, in the meantime you may wish to confirm the contract interpretation in writing with your salesperson for reassurance.
I hope this is helpful.
Yours sincerely
Sharon Dias
Many thanks again for everones input.
ANd thanks for the pointer re £250 cash-back - I'll call them tomorrow & try my arm with this 0
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