Are loyal energy customers LEGALLY penalised by their suppliers?

davidgmmafan

As others have said same as banks, just look at savings rate they are relying on apathy or inertia to retain most of thier customers. If you look at it from the companies point of view they don't really want people who constantly shop for the best deal as they won't make much out of them. Of course you could argue that if they offered better deals to begin with, like the insurence example, they may save some money...

I can see why they do it, but yes generally assume everyone is trying to screw you over and you won't go far wrong.

BTW if I understand it correctly an Ofgem licence conditions actually supports this stance on introductory deals. You can have a cheaper rate but only for a fixed period of time, at least that's the way the companies are spinning it.

They won't put you on thier best deal, indeed some companies will say they can't put you on the online tariffs - they can you just have to tell them what you want.

E.ON_Company_Representative

Hello BigAl99,

EnergyOnline and SaveOnline 3 are not the same tariff. It is not simply one tariff renamed. The prices, discounts and terms and conditions are all different.

The reason we do not simply change our customers from one tariff to another is more often than not, down to the terms and conditions. Ofgem regulations insist that we do not switch customers to contracted tariffs without customer consent.

For example, the SaveOnline 3 tariff has a cancellation fee which may apply if you were to switch supplier or tariff while on the SaveOnline 3. I am sure a customer would not be happy to find they had been charged a cancellation fee if they never agreed to accept those terms.

Another point to mention is that because of the difference in prices and discount of a particular tariff, in different areas, it may not always benefit the customer to switch. At the moment we do not have the facility to check individual accounts automatically to find the best tariff. Some customers do not choose their tariff solely on the price. They may choose a fixed tariff, a green tariff, a tariff which tracks another supplier’s prices, etc.

I would recommend using one of the third party comparison websites to find the best deal. They will always include your own supplier so it may not mean a change of supplier is needed, simply a change of tariff.

Thanks

Brian

undaunted

Loyalty is not for companies who sell you things it's for people you know & trust, relatives, friends etc!

Immoral possibly, illegal no, nor confined to energy companies & there will always be a co. employee on hand to give you some excuse as to why they didn't / can't tell you the simple fact that you could be saving 20% on your energy costs. The simjple answer is teach them some manners & ethicws, ie vote with your feet by going elsewhere, even if not the cheapest (as said above not all customers choose to deal on price alone!)

Cardew

undaunted wrote: »

The simjple answer is teach them some manners & ethicws, ie vote with your feet by going elsewhere,

'Frying pan into Fire' comes to mind.

Most of the firms are exactly the same; the exception being Ebico and they are too expensive for most people.

molerat

So if you want a company with morals it will cost you money

BigAl99

E.ON_Company_Representative:_Brian wrote: »

Hello BigAl99,

EnergyOnline and SaveOnline 3 are not the same tariff. It is not simply one tariff renamed. The prices, discounts and terms and conditions are all different.

The reason we do not simply change our customers from one tariff to another is more often than not, down to the terms and conditions. Ofgem regulations insist that we do not switch customers to contracted tariffs without customer consent.

For example, the SaveOnline 3 tariff has a cancellation fee which may apply if you were to switch supplier or tariff while on the SaveOnline 3. I am sure a customer would not be happy to find they had been charged a cancellation fee if they never agreed to accept those terms.

Another point to mention is that because of the difference in prices and discount of a particular tariff, in different areas, it may not always benefit the customer to switch. At the moment we do not have the facility to check individual accounts automatically to find the best tariff. Some customers do not choose their tariff solely on the price. They may choose a fixed tariff, a green tariff, a tariff which tracks another supplier’s prices, etc.

I would recommend using one of the third party comparison websites to find the best deal. They will always include your own supplier so it may not mean a change of supplier is needed, simply a change of tariff.

Thanks

Brian

Thanks for this lengthy "non-answer". The question is "in what way is receiving electricity down the wire" and "paying for it by direct debit" and "managing the account online" any different when you change the name. I do not see any justification for an average 20% price difference between existing loyal customers and new ones you are touting for the business of. Sorry - jus' don' make sense. The point is if you can make the energy cheaper you should pass it on to your Existing Customers! Geddit? It's just good business sense. Anything else just looks like profiteering and ultimately gets you a bad name. Let your Existing Customers know when you have a cheaper offer and you will get repeat business. Don't leave it to them to have to physically look elsewhere, 'cos they'll leave. In fact - make it your reputation to always seek the cheapest option for existing customers and they will stop looking elsewhere. Duh.

In short - you should give me the option, not make me look for it.

...But I guess that just ain't the business model you are using.

BigAl99

Incidentally - here's a small anecdote that is pertinent:

Some time ago, I used to get my energy from N-Power. After a while, I noticed that my bills were going up radically every quarter and I sent them an email saying that if this continued, I would probably switch to one of the (at that time many) cheaper suppliers. They then phoned me and told me to sit tight, because they were going to radically drop the rate one week into the next quarter and would be competitive again.

Sure enough, at the end of that quarter I saw that they had dropped the rate and (at that time) were indeed VERY competitive....

...BUT... When I looked more closely at the bill, I discovered that according to them they had "estimated" that I had used some 43% of that quarter's energy in the first week of that quarter... at the higher rate before they lowered their tariff. This was 531kWh in 8 days - or 2.77kW per hour for 24 hours of every one of those 8 days!

Which meant for the remaining 71 days of that quarter (according to their "estimate") I conveniently only used 0.4kW per hour for 24 hours of every day (=696kWh) at their new much lower rate.

This was obviously complete bull and I told them so ... in no uncertain words ... via email. I got ZERO response. So I told them I was going to "switch".

I was then contacted no less than THREE TIMES by different representatives of their (and I kid you not) "Sorry You Are Leaving" - team. In each case I told them why (via email with documentation) and each time I received no response to my complaint (each new representative was apparently unaware of what I had told the previous one).

I then switched to Eon (back then in late 2007). And was impressed by their much better service and overall responsiveness (till now). I now realise that Eon have been upping that rate continously for three years without telling me that I could switch to their new cheaper (and frankly, merely "renamed") products. Three years means there was no tie-in anymore. They just omitted to tell me that I could have made an "internal switch".

I tell the original N-Power anecdote to the N-Power sales people who somewhat regularly turn up at my front door touting for business. It has become my "little bit of fun" watching them squirm as the story unfolds - especially when I offer to show them the actual bill in question. At that point they usually leave saying their apologies. But of course - like the "Sorry You Are Leaving"-Team, the sales section sends a fresh new representative next time who of course has not heard of my complaint. How sweet. Clearly I shall have fun drawing blood until the end of time.

The point of this anecdote? Well, it does not matter a toss how much cheaper N-Power are - they have lost my TRUST. And that means they have more or less permanently lost my business.

And even more to the point - I don't mind telling people why.

That is what I mean by loyalty - it is whether you TRUST the company. And it is worth money.

Here endeth the lesson.




Seriously though - what kind of peculiar mind came up with the name "Sorry You Are Leaving"-Team? Gaarrrgh! Perhaps they were pulling my leg?
:snow_laug

Cardew

BigAl99 wrote: »

Let your Existing Customers know when you have a cheaper offer and you will get repeat business. Don't leave it to them to have to physically look elsewhere, 'cos they'll leave. In fact - make it your reputation to always seek the cheapest option for existing customers and they will stop looking elsewhere. Duh.[/I]

Whilst I wish you were correct; sadly I doubt if you are!

You are making the assumption(wrongly IMO) that the average customer understands the finer points of gas/electricity tariffs.

Despite massive publicity over the past decade or more, the most 'popular'(a term BG uses!!) tariff in UK is BG's Standard tariff. That despite of it being one of the most expensive in UK - albeit a little more competitive these days.

molerat

Cardew wrote: »

Whilst I wish you were correct; sadly I doubt if you are!

You are making the assumption(wrongly IMO) that the average customer understands the finer points of gas/electricity tariffs.

Despite massive publicity over the past decade or more, the most 'popular'(a term BG uses!!) tariff in UK is BG's Standard tariff. That despite of it being one of the most expensive in UK - albeit a little more competitive these days.

But it is the cheapest standard tariff

BigAl99

molerat wrote: »

But it is the cheapest standard tariff

Herein lies perhaps the problem.

The "product" appears to be a "tariff".

However, the "product" is not really advertised as a "tariff" - it is advertised as a "service" (direct debit discount, internet management, paperless, etc) with a short term "discount" and long term "lock-in" for competitions sake.

Physically the "product" is supposed to be ENERGY.

People understand "service" - they get their energy piped to them and don't have to bother remembering to pay the bill or filling cabinets with useless bits of paper.

People understand a physical product even better! In fact, perhaps Tesco could sell me the energy in bottles some day - that would make more sense as a "product".

The "tariff" is an artificial product that covers much hocus pocus and smoke and mirrors. I really fail to see how the "competition"-reason originally given for introducing this artificial product back in the days of de-nationalisation is really benefiting the customer, given all the comments in this thread and the need for the customer to almost daily do the job of SEEKING the cheapest option. This is perhaps the best argument for banishing the idea of a "tariff" as a "product" entirely!

And in the end, if the customers have to put in SO much of their own time and effort to managing the "tariff" in order to get the best rate, it really is a bit steep to try and imply that this "product" has anything to do with "service". It already ceased long ago to have anything to do with "physical" products - the energy flows the same no matter what. It even comes from the same place! It strikes me that the "product" we are buying is the equivalent to the hocus pocus carried out on a street corner with three cups and a little ball.

It's a shame that there really isn't a "competing product" that actually gives me what I thought I was paying for - energy - yes I'll have 2 kilos please, oh and half a pound of carrots.