MSE News: Npower to pay £70m in refunds after billing blunder

edited 1 October 2010 at 1:48AM in Energy
174 replies 21.4K views
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  • edited 16 November 2010 at 8:22PM
    sofa-spudsofa-spud Forumite
    82 Posts
    edited 16 November 2010 at 8:22PM
    scoobysave wrote: »
    This I was told equated to an overcharge of £51.28 plus VAT of £6.17.

    From this the average price per unit refunded would be 2.64p.

    It would also appear I have not been paid any interest!
    I think they have told you wrongly, by my reckoning, the figures for the £6.17 value are:
    2.56 VAT (@5%)
    3.61 'interest' (at 6.7% in total, not PA)

    You don't say what tariff you were on, but the figures for the standard tariff at the time in London show the price differential was less than 2.64/unit (actually 2.497) until Jan 08 when it rose to 4.698. All of which suggests some of the overcharge has been 'allocated' to the months of Jan 08 to April 08.
    A whopping 127 units or 6.5% of the overcharge by my reasoning...:cool: Now what happend to their sculpting profile...

    Then of course there is the question of why they are only paying you 1 year of interest (you are entitled to claim for 8% PA non-compounded under CPR). I notice in their statements they keep referring to this as 'payment in lieu of interest'
    I wonder how they would view anyones 'payment in lieu of gas consumed'...:p
  • You would have reached the 4572 maximum on 4/1/08. Therefore all the excess units were charged at the post 4/1/08 price rise. Using an average price differential of 3.75p (regional pricing could vary this considerably so find out what your exact prices were)

    1942*3.75 = £72.82

    £76.46 incl VAT

    £81.58 incl interest.

    I have seen several posts now where they appear to have the No. of units correct but the price differential used is unfathomable as they never say in their breakdown what prices they have used to determine it. Whatever it is they do use always seem to be less than they actually charged for these excess units.

    I expect it is in npowers definition book. It will be under F for fairness. Above Y for 'tariff year' and below A for Almost Always Accurate Billing nearly.:)
  • I have seen several posts now where they appear to have the No. of units correct but the price differential used is unfathomable as they never say in their breakdown what prices they have used to determine it. Whatever it is they do use always seem to be less than they actually charged for these excess units.
    Frm Scoobysave's post it is possible to work it out, but it does need more detail such as the actual unit prices they were charged at the time(I had to use the unit prices from my bills to arrive at the figures given). Their arrival at the apparently incomprehensible 'average' unit price appears to be from calculating overcharge on a month by month basis.
    I believe this is where they are benefitting most from their method as they then claim that the overcharge was at the month concerned, as so at the lower price in force at the time. This would be in addition to their pro-rating gas usage to a monthly basis, given they dont usually record this but work on a quarterly basis.
    You & I both agree with the principle that people were charged & paid for gas throughout the year, so when they reached the 4572 limit (typically in Jan 08) it was only then that npower committed the offence of overcharging. At this point forward all overcharged units were at the higher price.
  • meggsymeggsy Forumite
    741 Posts
    Is there any need for concern that when taking ID to the Post Office to collect the refunds npower are collecting data i.e., drivers licence number in my case. It's recorded on the receipt. I asked this a few days ago but later deleted it but noticed another comment here
    http://blogs.thisismoney.co.uk/2010/11/npower-.html#comments
  • meggsy wrote: »
    Is there any need for concern that when taking ID to the Post Office to collect the refunds npower are collecting data i.e., drivers licence number in my case. It's recorded on the receipt. I asked this a few days ago but later deleted it but noticed another comment here
    http://blogs.thisismoney.co.uk/2010/11/npower-.html#comments

    Probably not. Why not just take a utility bill and council tax demand.
  • sofa-spud wrote: »
    I think they have told you wrongly, by my reckoning, the figures for the £6.17 value are:
    2.56 VAT (@5%)
    3.61 'interest' (at 6.7% in total, not PA)

    You don't say what tariff you were on, but the figures for the standard tariff at the time in London show the price differential was less than 2.64/unit (actually 2.497) until Jan 08 when it rose to 4.698. All of which suggests some of the overcharge has been 'allocated' to the months of Jan 08 to April 08.
    A whopping 127 units or 6.5% of the overcharge by my reasoning...:cool: Now what happend to their sculpting profile...

    Then of course there is the question of why they are only paying you 1 year of interest (you are entitled to claim for 8% PA non-compounded under CPR). I notice in their statements they keep referring to this as 'payment in lieu of interest'
    I wonder how they would view anyones 'payment in lieu of gas consumed'...:p

    Thank you all for the replies.

    I called nPower again this morning to get more info, I was on the Sign Online 4 Tariff and was charged at the following rates:

    From April 2006 High (H) 3.165 Low (L) 1.691
    From 1st July 2006 (H) 3.639 (L) 2.047
    From 1st October 2006 High (H) 4.265 Low (L) 2.399
    From 30th April 2007 (H) 4.412 (L) 1.915
    From 5th January 2008 (H) 5.096 (L) 2.212
    From 29th August 2008 (H) 7.465 (L) 2.577

    It's amazing how much the prices rose between 2006 and 2008. :eek:

    I didn't get the exact date I went over the 4,572 units.

    I have been getting the MSE emails for a good few years now and I was not aware of this going on at all until I got the letter, must have missed the one reference to it!

    Thanks to all the hard work you guys have been putting in on this for everyone's benefit. :T:T:T
  • meggsymeggsy Forumite
    741 Posts
    Probably not. Why not just take a utility bill and council tax demand.

    I probably should have done DD, but if anyone had taken their passport, passbook, rentbook, birth or marriage certificate presumably the numbers on these would have been recorded as well. Surely the computer could simply say 'yes' that my ID documents matched the address on the npower letter :(
  • meggsymeggsy Forumite
    741 Posts
    scoobysave wrote: »

    I have been getting the MSE emails for a good few years now and I was not aware of this going on at all until I got the letter, must have missed the one reference to it!

    Believe me before we realised that the 'gas sculpting' thread had been mentioned in the newsletter we thought the site was being hacked because the 'views' soared ! It's a mystery to me why MSE didn't include it in many more newsletters :(
  • I checked on MSE for any advice to see whether by accepting this offer now I have accepted this in full and final settlement of any possible claim, this was how I found this thread.

    If it was more widely publicised then I (and many other like me) would have claimed earlier as some people have done. I can however see that it must be hard to try to ensure a reasonable coverage of most topics without making the email so long that it never all gets read, but this does affect a large number of people so could/should have received more publicity.
  • edited 17 November 2010 at 10:33PM
    sofa-spudsofa-spud Forumite
    82 Posts
    edited 17 November 2010 at 10:33PM
    scoobysave wrote: »
    From April 2006 High (H) 3.165 Low (L) 1.691
    From 1st July 2006 (H) 3.639 (L) 2.047
    From 1st October 2006 High (H) 4.265 Low (L) 2.399
    From 30th April 2007 (H) 4.412 (L) 1.915
    From 5th January 2008 (H) 5.096 (L) 2.212
    From 29th August 2008 (H) 7.465 (L) 2.577
    Thanks for these, I've plugged these into a spreadsheet & based on your prices they seem to have assessed that you used approx 1220 units for Apr 07 to Dec 07, the remaining 720 they assess was used Jan 08 to March 08. Clever, but its still in their favour the way they have done this.

    Not least the 'payment in lieu of interest' which has denied you of £7.75 in my opinion.:cool:

    From the info you have supplied so far it is obvious that npower are basing the refund on values calculated throughout the year of concern.
    i.e. it appears they have decided that they overcharged you for 183 units in May 07 at a cost of £4.58 +VAT. If these were refunded on the Jan 08 prices it would have been £5.28+VAT

    Clearly they have done it this way instead of the method that you would have reached 4572 sometime in Jan(probably) and so all units over 4572 where charged at the rate in force for these month(s), in your case it would have been for a total of £56.01 +VAT & interest.

    So about 10% cheaper for them:cool:

    All the above is of course the way it appears npower are calculating these refunds. It does not mean that it is the honest way, or that I agree with their method (I don't).
    It is also on the assumption that the 1942 units overcharge they stated is actually the correct figure as well(and they haven't manipulated this):cool:

    Thanks again for the info, It has supplied another piece for the puzzle:T
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