Dispute with energy company large bill - advice please

SaleHunter

This could be quite long-winded, so bear with me please.

Okay, my dispute with EDF energy started in March of this year, when I received a final demand for a rather larger electricity bill (between £500 - £600), which had built up due to them losing my direct debit/bank details from which to withdraw payment for my electricity costs, although my gas was fine. This had been going on for 10 months, as i'm self-employed and as I have different earnings each month I never noticed, perhaps I seen the payment for gas on my bank statement and though everything was covered. You should have been more vigilant I hear you cry, yes, I agree, but this is the position I find myself in today.

Naturally I contacted them to complain, and they admitted that it was their fault (though they did try to pass responsibility on to me as well for not noticing). After much discussion, they allowed me to keep my payments for electricity at £50p/m and gas at £15p/m, although during a recent call the call handler said he considered this to be a mistake.

Last week I received a letter entitled Interim Electricity Payment Review, which in short informed me that I owed £648.23 in elecricity charges and they would be upping my direct debit to £200p/m!!! although this was based on estimated readings. Again I contacted them, informing them the exact readings which brought my balance on electricity to -£507.93 and my gas to +106.97, at which point they dropped their monthly demands to £170p/m, still an outrageous amount to pay in the lead up to christmas. They claim this is to pay the outstanding balance by the end of the financial year (April), and to cover my ongoing energy requirements.

I should add that my circumstances and energy requirements have changed during this time, the property used to be a family home until about a month ago, we have since seperated and I now live at the property alone, so there is no woman demanding the heating be on a full 20 hours a day lol, less clothes to wash and dry, less use of T.V. etc etc. Sometimes I don't stay here at all, and this will be the case for an extended period over christmas and new year.

I work it out that if I continue to pay £50p/m electricity and £15p/m gas then I will have paid £390.00 by April and will have the +106.93 on my gas account added to this to make £496.97, which is approx £11.00 short of my outstanding debt. Of course I will have ongoing energy usage, but this will be nowhere near the £60p/m they estimate. After much continued discussion, they phoned me back and said the lowest they would accept is £150.00p/m because the estimate my usage based on last years figures (which are no longer relevant as I live alone). The other option I was given was they could remove the budget billing option and invoice me in total, with a period of 2 weeks to pay. I turned down all offers to alter the automated change in billing as I reckon that this may be seen as a willingness to accept these new charges.

So, i'm basically looking for a bit of advice on what to do next, the next billing day is the 28th of the month. I was considering cancelling my direct debit and either making payment by cheque or switch for as long as possible, before they start giving me grief, I reckon the longer this goes on, the more i'll have paid off and they will avoid taking me to court. My legal defence at the moment would be a) Their breach of contract by failing to collect payment at the times stated in said contract b) Their agreement back in March to allow me to pay £65p/m in total for both gas and electricity.

I'm quite willing to be as awkward and stubborn as necessary with this company, but to be honest i'd rather not see this affect my credit rating at the same time.

All thoughts and suggestions welcome.

SaleHunter

I see what your saying, but I don't intend to just roll over and cough up £300.00 in the run up to Christmas, especially when it's not necessary. If I just shrug my shoulders and say "oh well" then i'll be paying £165 for the next six months which works out at £990.00!!! plus i'll have a credit of £106.97 on my gas bill, total = £1096.97. Subtract what I owe (£507.93) and i'm looking at paying a fuel bill of £589.04 for 6 months for a single person in a small property.

Why should they be allowed to claim all this money up front on "estimates", when they will in no way reflect actual usage? especially when their basis for doing so is down to negligence on their part in the first place.

Cardew

To be quite honest you are not 'negotiating' with EDF from a position of strength.

The Direct Debit scheme can only apply if both parties are in agreement; the alternative of course is to come off the DD payment scheme and then you become liable for the whole outstanding sum; plus you will probably be on a higher tariff.(DD is normally cheaper)

I don't think you are correct at all that a company are in breach of a contract by failing to collect DDs. The contract is for supply of Elect/gas.

In effect you have had an interest free loan for a long while and, under the agreement you have reached, will continue to do so for a while to come.

So other than further negotiation with EDF to reduce the DD(and lengthen the payback time, I don't think there is a lot you can do!

Sorry if that isn't what you want to hear.

Cardew

Their agreement back in March to allow me to pay £65p/m in total for both gas and electricity.

Just a further point.

A Direct Debit plan does not "allow you" to pay anything. You agree that the company can take whatever is necessary for the services provided.

The only stipulation is that they must notify you in advance of the monies they intend to take from your account. They do not need your agreement although you obviously can stop the plan if you wish.

laura0141

Hello

I don't think you've much to gain by being 'difficult', to be honest. Yes, the company did make a mistake - if they weren't collecting direct debits (for whatever reason) then they should have written, sent a bill, reminder, etc. You also made a mistake - as you said, you should really have noticed. So there's fault on both sides.

You're correct in objecting to paying based on estimates but you have given them accurate readings (did you also give a reading for gas? Might as well get them both sorted) and you have used however much electricity and will have to pay for it in the end. It is not unreasonable to ask for more time to pay - companies will often allow you to pay over two 'energy years'. As their year seems to run from April you could ask for your payments to run from now until April 08 rather than April 07 thereby paying in 17 months rather than 5. If you're not considering changing your supplier then this could be a good option as it's interest-free credit.

Part of your monthly payment is for ongoing consumption. You are right to assume your useage will probably drop due to the change in circumstances and, if all in the world were fair, your payments should drop immediately. However, the utility company is coming at it from a slightly different angle. 'This customer's already used more than he's paid for. He's disputing the higher payment. How do we know his circumstances have really changed? What if he's just saying that to get out of making the payments?'

In order to reduce that part of your payment which is for ongoing consumption the company needs proof that your useage *has* changed ie meter readings. I'm trying to look at it from both points here - yes, you should be taken at your word but, also yes lots of people try to wriggle out of paying their bills.

What I'd suggest is that you make an agreement re the underpayment that's currently on your account. Then read your meter on the 1st of each month and phone it in. Ask if the useage part of your payment can be reduced based on the reading you're giving. Useage is usually worked out over a 12 month period so it will be a few months before the average drops enough to reduce your payments but keep phoning in those readings and asking.

Hope this is of some help - and that you can get your payments set at a reasonable level.

Laura

SaleHunter

I've since phoned Energywatch and they will have someone look into it for me.

Dont get me wrong, I accept that I am 100% responsible for the debt, I just feel that they are being rather unreasonable towards a customer who has been through three company handovers (Virgin-->Seeboard-->EDF) and that has never defaulted on a single DD payment.

I wonder, would putting the balance on a credit card be a worthwhile idea? I know very little about CC's and only recently made my first purchase on my old credit card in five years. Is there a way to use credit cards interest free?

SaleHunter

My last reply was done over the space of an hour, thanks for the further comments.

Cardew wrote:

Just a further point.

A Direct Debit plan does not "allow you" to pay anything. You agree that the company can take whatever is necessary for the services provided.

I would say using that terminoligy only strengthens my case, i.e. rather than making a concession for me it was agreed that they "could take" a set amount each month as "agreed necessary" by both parties.

Cardew

SaleHunter wrote:

My last reply was done over the space of an hour, thanks for the further comments.

I would say using that terminoligy only strengthens my case, i.e. rather than making a concession for me it was agreed that they "could take" a set amount each month as "agreed necessary" by both parties.

Rather a selective quote! and IMO does not in any way strengthen your case

The company have simply re-assessed the situation and notified you of an increase in your DD. You don't dispute that you owe the money.

This forum is full of complaints that a utility company did not increase a DD as soon as they discovered it was insufficient and large debit balance built up. You are complaining that in exactly the same situation they have increased your DD. A lose/lose situation for the company!!

In not collecting the DD, EDF lost out - not you; the money remained in your bank. Despite this they have agreed to lose even more interest by allowing the debt to be reduced gradually over the next few months.

It seems to me that you have been treated in a very fair manner by EDF. I can understand you wishing to lengthen the period of payback. However you asked for advice and have been advised that you don't have a strong case either legally or morally

SaleHunter

laura0141 wrote:

Hello

I don't think you've much to gain by being 'difficult', to be honest. Yes, the company did make a mistake - if they weren't collecting direct debits (for whatever reason) then they should have written, sent a bill, reminder, etc. You also made a mistake - as you said, you should really have noticed. So there's fault on both sides.

Yes, but the onus is on them to collect the payments, not for me to make sure that they are doing so.

laura0141 wrote:

You're correct in objecting to paying based on estimates but you have given them accurate readings (did you also give a reading for gas?

Yes, on both electricity and gas, and guess what, both were over-estimated, electricity debt came down, and gas credit went up. In total they were approx £180 out for one quarter.

laura0141 wrote:

It is not unreasonable to ask for more time to pay - companies will often allow you to pay over two 'energy years'. As their year seems to run from April you could ask for your payments to run from now until April 08 rather than April 07 thereby paying in 17 months rather than 5. If you're not considering changing your supplier then this could be a good option as it's interest-free credit.

My sentiments exactly, I have asked no fewer than three call handler's for this, but each saying that they are not willing to override the system. Like I say, my usage has dropped by more than 2/3rd's therefore my £65p/m would eat right into the outstanding balance and the ongoing usage within roughly 9/10 months or so.

laura0141 wrote:

Part of your monthly payment is for ongoing consumption. You are right to assume your useage will probably drop due to the change in circumstances and, if all in the world were fair, your payments should drop immediately. However, the utility company is coming at it from a slightly different angle. 'This customer's already used more than he's paid for. He's disputing the higher payment. How do we know his circumstances have really changed? What if he's just saying that to get out of making the payments?'

Yes, I understand, and the last lady I spoke to mentioned this to me, I offered to send either a copy or the original of my electoral register forms to prove my point but she declined. The other point I would raise is, if they are concerned about my willingness to pay, why not just run a credit check on me?

laura0141 wrote:

In order to reduce that part of your payment which is for ongoing consumption the company needs proof that your useage *has* changed ie meter readings. I'm trying to look at it from both points here - yes, you should be taken at your word but, also yes lots of people try to wriggle out of paying their bills.

Again, something that can be backed up, their estimate for this last quarter is based on what was used last year, there turned out to be an over-estimation of £140 over a period of 3 months!!! even taking rising costs into account there has obviously been a drop in actual energy used. Additionally, when I checked the estimated reading for the quarter just gone, I found that my actual reading (last week) was lower than what they estimated it to be 4 months ago!

laura0141 wrote:

What I'd suggest is that you make an agreement re the underpayment that's currently on your account. Then read your meter on the 1st of each month and phone it in. Ask if the useage part of your payment can be reduced based on the reading you're giving. Useage is usually worked out over a 12 month period so it will be a few months before the average drops enough to reduce your payments but keep phoning in those readings and asking.

The debt over 6 months works out at £84.55p/m, remembering that I am in credit on my gas to the tune of £106.97, and applying it against my debt would see the debt reduce to £400.96, which over 6 months is £66.82. However, another point is that they dont want to credit my electricity bill with the credit on my gas account, they want to leave it sitting there. So they are quite happy to overcharge my gas for 12 months and hang onto it but demand payment in full (and again overcharge) for electricity within 6.

My only reason for saying I am prepared to be difficult is simply down to the sheer inflexibility they have shown towards my case.

Thanks for your comments, definate food for thought in there.

SaleHunter

Cardew wrote:

In not collecting the DD, EDF lost out - not you; the money remained in your bank. Despite this they have agreed to lose even more interest by allowing the debt to be reduced gradually over the next few months.

Yes, but they then made an arrangement with me whereby I would remain paying £65.00 per month for both services. Whether entering into this agreement was not economically sound on their part is irrelevant, it was a financial arrangement made between myself and one of their company representatives, and should be allowed to run the term of 12 months as stated at the time.

Cardew wrote:

It seems to me that you have been treated in a very fair manner by EDF. I can understand you wishing to lengthen the period of payback. However you asked for advice and have been advised that you don't have a strong case either legally or morally

I'm not sure what's fair about refusing to credit one account with the overpayment of another? Nor do I see whats fair about being told to overpay on both accounts for the next six months, remember, they want £990.00 from me from now till april, on top of the £106.97 they are already "holding" for me.

domestic_goddess

SaleHunter wrote:

The debt over 6 months works out at £84.55p/m,

Is that amount just to pay off the debt because if it is then there is still you winter usage to account for also your usage may well have dropped a lot if there is only you living there now, but not necessarily as much as you think. EDF will be aware that bills dont always drop drastically when there is only one person living at the address.

Also the company I work for would say that some of the blame lies with yourself for the direct debit. In ten months you never noticed it not coming out of your bank account, this could be believable as a lot of people dont check their banks regularly enough (although I bet they would notice if the companies took more than they should) but in that 10 months they will have sent you bills showing your usage. Surely these would have mentioned that no paymenst had been made!!! We advise our customers that errors can happen but we send a bill/statement out to our customers for them to check everything is correct. If it isn't they need to let us know so we can put it right.

Also there is no point being difficult on principle because lifes too short, they are a business in the end. You are just an account number to them and they wont be getting stressed over it, when they hang up the phone to you they will move on to the next call and forget about you. What if you dont agree to their payments and they stop your supply or call in the baileffs?