Theft by Utility Companies ?

Captain_cliche

Is it just me!!!

If, like me, you take take the opportunity to change utility suppliers when they decide to hike their rates does it not seem totally unfair / immoral / an unfair advantage that just as Scottish Power have announced that they will increase their customers bills as from the 25th November 2010, if you choose to exercise your right to change supplier the earliest these "ultra high tech" companies could arrange this will be sometime in January 2011 (if you are lucky!).

I would think it only fair that customers are given an opportunity / chance to seek out a more competitive supplier BEFORE their current supplier is allowed to hike their rates following an announcement. If OFGEM were to insist on such a period of notice (my guess on the utility companies dire performance on this issue they would need to give about 8 weeks notice) this would give customers a fair chance to change to a more competitive supplier, with an added benefit of perhaps giving the same companies an incentive to speed up the change process.

I am particularly galled at this latest abuse by a Utility company having transferred to Scottish Power from EON when they sent an undated letter to me several months ago which in effect gave me less than 2 weeks notice that their rates were rising, the same letter had no contact details on for EON nor did it have any details of the rates they were already charging me so that I could compare same and make a reasoned judgement. I appreciate that someone may say it is relatively easy for me to get the old bills out and calculate this myself, but the cynic in me looks at EON letter with no date, no contact details (telephone, email, web site etc.) and no current rates as an attempt by EON to get such abuses past those who may not be able react.

OFGEM where are you ?????

backfoot

I think I read that there was already a proposal to introduce a mandatory 30 day advance notice period. Whether this comes to fruition we will see.

However,and this needs knowledge ,we already probably have a better deal. At the moment, the rules are that the supplier has 65 days before and 65 days after a price change to inform you in writing. How these rules evolved is beyond my comprehension.

The beauty though is that, if you then reject that price increase and give such notice to the supplier within 10 days,(some allow longer) then they are obliged to maintain the old rates until you switch supplier.

So armed with this, the later they give notice, the longer you can have the old rates.

I think the suppliers used this at first to hide their sly increases, but as customers have become aware of this right, more of them now give advance notice.You then still have say 4 to 6 weeks at the old rates while you switch to the next best deal.

I think your premise is fundamentally sound, but for those in the know it may actually mean higher prices earlier in a rising market.

KimYeovil

Captain Cliche - so up to five months at the original prices is a bad thing. Why do you find this objectionable? Bizarre complaint.

t0rt0ise

KimYeovil wrote: »

Captain Cliche - so up to five months at the original prices is a bad thing. Why do you find this objectionable? Bizarre complaint.

Why five months?

I'm guessing the OP doesn't know the rules as they stand. Backfoot has kindly explained them.

KimYeovil

Up to five months (and more). One day to ninety days plus fourteen days plus six to eight weeks.

backfoot

Here is a link to the proposal and why. It is proposed because many customers are not aware of the right to reject a price increase.


http://www.energysavingtrust.org.uk/Resources/Energy-saving-news/Energy-bills/Ofgem-Energy-suppliers-to-give-30-days-notice-of-price-rises

If you were aware, in broad terms the maximum advantage at the old rates could be 60 days after the price rise, plus the period of notice to reject 10 to 20 days, then the time to switch which is 4 to six weeks.At most 95 days or just over three months.

Things have changed though, I have just switched and the supplier in that case did give advance notice which is the principle you were looking for.

You must give notice in writing if you intend to reject a price increase within the 10 to 20 day window of opportunity.

Hope this lays it out more helpfully.:D

davidgmmafan

With regards to how this came about I would guess the thinking was something like this. It would cost a significant amount to write to every customer when there is a price change, with the 65 day window there's a fair chance they can notify on the bill assuming quarterly bills, some are moving away from these:(

Now they're going to have to pay for seperate notifications and the cost of this I guess its going to be factored into any price changes. I agree switching could be quicker, there are lots of curious things about this industry which is much more complicated than you'd think it was.

Premier_2

backfoot wrote: »

...If you were aware, in broad terms the maximum advantage at the old rates could be 60 days after the price rise, plus the period of notice to reject 10 to 20 days, then the time to switch which is 4 to six weeks.At most 95 days or just over three months....

Actually I thought it was 65, but whatever, it is working days.

Those days alone amount to 3 months, and there's a good reason why. It was designed so that money wasn't wasted sending people letters advising them of a price increase, but could simply be included with the next quarterly bill ... which of course could be up to 3 months away.

Edit:

Energy companies are currently allowed a 65 working day period after changing prices in which to notify customers of this price rise. Customers are allowed to switch to another supplier to avoid paying the increased price (if they decide to switch they pay the previous price up to the point their new supplier takes over). Under the rule customers are allowed up to 20 working days after receiving this notification to inform their current supplier of their decision to switch. From this notification of intention to switch suppliers, the new supplier then has 15 working days to inform the current supplier that they are taking over supply to the customer.

http://www.ofgem.gov.uk/Sustainability/Cp/CF/Documents1/Ofgem panel - workshop 2 - 65 day report.pdf (page 8)

So that's a possible 100 working days in total which I think relates to about 5 months
(and there's still at least another couple of weeks before the switch will probably occur)

KimYeovil

It is 65 working days = 90 days = one quarter (as in from the olden-days so it would just be sent with the usual quarterly bill rather than the expense of an extra mailing).

But, hey, let's create more expense and put the prices up because some people insist on behaving like children.

caveat_emptor

Captain_cliche wrote: »

Is it just me!!!

OFGEM where are you ?????

Certainly not acting in the consumer interest. Some time ago I had an energy supplier issue and was referred by OFGEM to a plethora of government consumer protection(?) organisations all of which would offer advice but could do nothing to resolve my issue. I even wrote to the then Minister for Consumer Affairs and did not get a reply.
If you're a consumer in todays utilities jungle you're on your own.

backfoot

Thanks for clarifying its 65 working days.

I was just trying to lay the timeline out more fully with an explanation rather than just a string of dates which I clearly hadn't understood. At least highlighting my error has got us to the right answer.

We've also alerted the OP to the right to reject which is important and not so widely known.

Anyway,it's about to change by the looks of it which will be the original poster's liking.