First Utility - Any users or reviews

NonGeographicalMan

Cardew wrote: »

Phones, Internet, Mobile phones, Bank saving Accounts, Mortgages, etc etc all offer inducements in return for signing a contract that has penalty clauses.

Penalty clauses for leaving early are only justified where a company has made up an front equipment investment like a new satellite dish and box or a new ADSL router and ADSL exchange install costs. Even then customers should have the option to pay those things up front instead of being locked in for a year or more due to a hidden subsidy to cover those costs through the monthly charges.

With gas and electricity no physical investment is made in a new customer in terms of equipment (of course that may change in 2012 with Smart Meters) so there is no case for trying to lock customers in. If switching could be immediate and penalties for leaving were outlawed then large cashbacks for joining a company would also disappear as there would be no point in trying to bribe a new customer to join as he could not then be prevented from leaving if prices were soon raised against him or her.

There is no excuse for the 6 to 8 week transfer period between suppliers when nothing has to change on the network. Its only purpose is purely a restrictive practice (something Ofgem seem to be past masters in) to try allow your existing supplier to lie to you that you will lose out if you leave them.:eek::mad:

Cardew

NonGeographicalMan wrote: »

Penalty clauses for leaving early are only justified where a company has made up an front equipment investment like a new satellite dish and box or a new ADSL router and ADSL exchange install costs. Even then customers should have the option to pay those things up front instead of being locked in for a year or more due to a hidden subsidy to cover those costs through the monthly charges.

With gas and electricity no physical investment is made in a new customer in terms of equipment (of course that may change in 2012 with Smart Meters) so there is no case for trying to lock customers in. If switching could be immediate and penalties for leaving were outlawed then large cashbacks for joining a company would also disappear as there would be no point in trying to bribe a new customer to join as he could not then be prevented from leaving if prices were soon raised against him or her.

It is a commercial decision by the Utility companies to offer an inducement(a cheaper tariff) in return for the customer agreeing to contract with them for a set period and there is a penalty if they break that contract.

People don't have to go on that tariff if they don't want to, they can have a 'standard' tariff without any fixed period - they can leave when they want.

If you agree to save money for a fixed period with a bank you get a higher rate of interest and a penalty for leaving early.

I get a cheaper rate for my internet by agreeing a 18 month contract, with a penalty if I leave early. Ditto for a mobile(for my handset)

It is simply a case of the company offering a contract with rewards and conditions, people accept it or reject it - what is the problem?

NonGeographicalMan

Cardew wrote: »

I get a cheaper rate for my internet by agreeing a 18 month contract, with a penalty if I leave early. Ditto for a mobile(for my handset)

It is simply a case of the company offering a contract with rewards and conditions, people accept it or reject it - what is the problem?

The problem is that the consumer's choice is actually massively distorted at a single moment in time by some large financial inducement that distorts your choice when viewed in the round a duller sounding product without the big up front inducement would often have been cheaper over the contract term.

The problem is also that all the companies start only offering products with the fixed long term and that open and free contracts are removed and made unavailable even if you want them.

BT is a case in point. They are the incumbent with massive significant market power to lead prices but now they are allowed to force customers to have to sign up for at least 12 months to avoid the penal per call connection fees for out of bundle calls that didn't used to exist but that they have now introduced. Similarly BT then fiddle with the hours of off peak calls to water down the value of the 12 month contract that they have sold to customers.

I suppose you are one of those people who just assumes there is competition in utilities because there are more companies in the marketplace but fails to spot the cartel like basis on which many of the companies sell their products and which consequently removes from customers any form of real choice.

Cardew

NonGeographicalMan wrote: »

I suppose you are one of those people who just assumes there is competition in utilities because there are more companies in the marketplace but fails to spot the cartel like basis on which many of the companies sell their products and which consequently removes from customers any form of real choice.

I have said I am not a fan of electricity/gas privatisation and some of the practices so I certainly am not a apologist for these companies.
Your objections, valid or not, are down to effective regulation - or lack of effective regulation.

However in terms of competition it is rather better than yesteryear when there was a monopoly!

It is a rather silly line of reasoning to accuse me("I suppose you are etc") and then condemn me on the grounds that your accusation has some merit.

To repeat, the point of this discussion is that the companies offer an cheaper tariff which comes with certain conditions. Customers are at liberty to accept or reject that tariff!

It is normal commercial practice that is not unethical.

NonGeographicalMan

Cardew wrote: »

To repeat, the point of this discussion is that the companies offer an cheaper tariff which comes with certain conditions. Customers are at liberty to accept or reject that tariff!

Well that is where I fundamentally disagree with you as in my view customers are basically forced to take the contracts with the fixed monthly direct debit and the long term contract because any tariff with flexible terms and no penalty for leaving usually now costs 30% more than the tariff the utility companies want to sell you. Hence in reality there is no real choice for the rational consumer wanting to avoid paying over the odds but to be forced in to agreeing to these ever more restrictive contractual terms. The same is true with telephone line rental.

It is normal commercial practice that is not unethical.

Again I must disagree with you as most "normal commercial practice" now actually appears to be highly unethical compared to the dull but basically ethical methods of selling these services that existed in the past.

Normal commercial practice now is to make you think you are getting one thing only to lure you in to signing a contract where it will turn out that you end up getting something quite different from what you had bought in to.

The executives of these companies are not interested in a long term honest relationship with happy customers but only instead in ramping in customer numbers in the short term to meet some bonus target or another. By the time the customers rumble the deal is not honest the ruthless executive has moved on somewhere else at en even larger salary.:mad:

Any useful change in utilities that might actually help customers such as Smart Meters is constantly obstructed by the main UK utility suppliers because they know that it will result in customers consuming less energy, hence reducing their profits.

Cardew

NonGeographicalMan wrote: »

Well that is where I fundamentally disagree with you as in my view customers are basically forced to take the contracts with the fixed monthly direct debit and the long term contract because any tariff with flexible terms and no penalty for leaving usually now costs 30% more than the tariff the utility companies want to sell you. Hence in reality there is no real choice for the rational consumer wanting to avoid paying over the odds but to be forced in to agreeing to these ever more restrictive contractual terms.


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No, they are not 'forced' to take such contracts.

They are offered inducements to take such contracts.

The discounts for dual fuel and Direct debit usually applies to all tariffs - including those with no tie in period.

The fact that you, or I, don't like the way tariffs are structured is not the point.

In any case the penalties are usually small in relation to the savings - usually in the order of £20 or £30 per fuel.

You can get that sum back from the money made from 'switching'.

If the savings are 30%(your figure) and the average bill is £1200 then you save £360 a year on a cheaper tariff. A couple of months savings from the inducements and you can pay the penalty.

TIMETRAPPER

Firth Utility is the worst company I have ever had the displeasure of using even considering my 4 decades in a senior management position dealing with businesses every day of my life. They didn't send bills once signed up (except one near the beginning) and despite me providing meter readings on the exact days each month as requested, they still didn't bill me. You will not believe the amount of emails and letters I've sent them which NEVER got answered.I was worried that they'd eventually send a huge bill - and guess what?

After about six months, they then sent a huge bill. I immediately made arrangements to pay it in two payments. I have (thankfully) got a letter in front of me from them dated 22nd June to confirm that they accepted this. I paid first payment June 23rd as planned. The second amount is due July 21st - 11 days from today, and yet TODAY I have received a Bailiff's letter from Grosvenor Legal Services in Sheffield, demanding payment for the 21st July payment within seven days or face a court! AN ABSOLUTE NIGHTMARE.

I have an outstanding and impeccable credit rating and have NEVER EVER EVER paid a bill late in my 60 odd years of existence on this planet - and to receive a Bailiff's letter is frightening the way this company is obviously so disorganised.

TIMETRAPPER

I've just posted my NIGHTMARE experience with First Utility - so understand how you feel.

TIMETRAPPER

See my entry in today's forum. First Utility - NIGHTMARE!

bluestick

Just got an email from FU today with the normal 'submit your readings' but also with a 'price update' link. Clicked the link as I foolishly thought there might be a price drop ..... Oh no, everything went up by about 15-40% with my gas standing charge going from 31.5p/d to 70.9p/d an amazing 125% increase - !!!!!!!

Noticed this increase ties in with having just completed the 'no price rise in the first 3 month guarantee' - coincidental?

Has anyone else experienced this kind of price rise - especially when they are advertising much lower rates on their website. Phoned Customer Services and was informed that this was across the board for all iSave Dual Fuel V2 customers.