Npower - curious anomaly

Lester_Squair

After many years of running a positive balance with NPower through DD we now pay quarterly. More expensive I know, but avoids that annoying credit balance.

I recently received a quarterly bill which recorded a price rise only 5 days before the billing date. We had supplied meter readings for the last account and this one.

In looking at the bill something didn't quite tally. There was an estimated meter reading at the price change date and allocation of both electricty and gas usage for the period was heavily skewed to the higher price. Indeed, the units consumed per day in the 5 days of October were 3 times and 6 times (Electricity and gas respectively) that consumed per day for in previous 86 days.

Initially I was willing to accept that this was perhaps a "seasonal" adjustment. However, given the prevailing circumstances (21c) and that fact I know we hadn't altered our own patter of usage, this just didn't seem equitable. In fairness NPower have now taken this on board and will issue a manually calculated account- fair do.

However, being the pedant that I am, I obtained on line Npower's own guidance " how we calculate your bill". Using a spreadsheet I set up a simple calculation to allow me to check this latest bill and the correct amount due. Although the spreadsheet tallies exactly with the worked example Npower give, it threw out a completely different result for my latest bill. Significantly, there was an anomaly in the allocation of primary ( the higher rate) units for both gas and electricity. These replaced standing charge and are apportioned over a 12 month year.

Having raised this with Npower, I did get a plausible explanation that, provided they don't allocate more than the total number of units per annum they are entitled to vary how these are allocated - this is not explicit in their own guidance.

Armed with the info I have started reviewing my bills for the past year. Surprisingly, this recent anomaly does not appear to be a one off. The difference is not significant but, on a quarterly basis, averages between a few tens of pence to a couple of pounds - always in Npower's favour. I am now going back to check the annual allocation of units - which is difficult given that quarterly billing isn't chronologically precise!

If you multiply the average "error" over the millions of customers Npower supply this will, at the very least, give them a significant cashflow advantage and might amount to an annual overcharge running to millions of pounds.

Can I suggest all Npower customers
1. scrutinize your price change bills to ensure they have been produced fairly.
2. check the quarterly and annual allocation of Primary units.
3. make sure your bill is prepared accurately and that you understand it fully.

notbritishgas

I am presuming yuu are aware that Npower allocate the primary units per day and different months in the year have a different allocation, much higher in the winter months than in summer.

In the past they have been taken to task over some underhand tactics but I think now they come clean about this "sculpting" of the primary units.

https://customerservices.npower.com/app/answers/detail/a_id/95/kw/primary%20units/session/L3RpbWUvMTMxODQxNDIzMC9zaWQvVGR5Q0VtR2s%3D

By the way I think this only applies to gas, the electricty ones should be applied evenly over the year.

DirectDebacle

Welcome to MSE and an excellent first post.

Energy suppliers are required to give advance notice of price changes. It is important for customers to note when these come into effect and submit meter readings just before the date they are applied.

It appears you did this and it may be their system calculated the bill prior to receiving your reading. That may account for the skewed estimate and should be easily sorted by a rebilling to the reading.

As far as seasonal weighting goes, npower have had some problems with this in the past.

You have noted the different monthly rates they apply throughout the year.

What can happen, as an example is this.

Seasonal weighting 46kWh p.m. Tier 1 units for May-Sept.

Say you use no gas in May or June and in July you use over 138kWh.

Unless you submitted meter reading showing that there was no usage in May and June npower will calculate the bill on the assumption that the usage was spread over the 3 months and will charge the maximum 138kWh Tier 1 and not the 46kWh you would expect.

energysavingexp

Lester_Squair wrote: »

After many years of running a positive balance with NPower through DD we now pay quarterly. More expensive I know, but avoids that annoying credit balance.

I recently received a quarterly bill which recorded a price rise only 5 days before the billing date. We had supplied meter readings for the last account and this one.

In looking at the bill something didn't quite tally. There was an estimated meter reading at the price change date and allocation of both electricty and gas usage for the period was heavily skewed to the higher price. Indeed, the units consumed per day in the 5 days of October were 3 times and 6 times (Electricity and gas respectively) that consumed per day for in previous 86 days.

Initially I was willing to accept that this was perhaps a "seasonal" adjustment. However, given the prevailing circumstances (21c) and that fact I know we hadn't altered our own patter of usage, this just didn't seem equitable. In fairness NPower have now taken this on board and will issue a manually calculated account- fair do.

However, being the pedant that I am, I obtained on line Npower's own guidance " how we calculate your bill". Using a spreadsheet I set up a simple calculation to allow me to check this latest bill and the correct amount due. Although the spreadsheet tallies exactly with the worked example Npower give, it threw out a completely different result for my latest bill. Significantly, there was an anomaly in the allocation of primary ( the higher rate) units for both gas and electricity. These replaced standing charge and are apportioned over a 12 month year.

Having raised this with Npower, I did get a plausible explanation that, provided they don't allocate more than the total number of units per annum they are entitled to vary how these are allocated - this is not explicit in their own guidance.

Armed with the info I have started reviewing my bills for the past year. Surprisingly, this recent anomaly does not appear to be a one off. The difference is not significant but, on a quarterly basis, averages between a few tens of pence to a couple of pounds - always in Npower's favour. I am now going back to check the annual allocation of units - which is difficult given that quarterly billing isn't chronologically precise!

If you multiply the average "error" over the millions of customers Npower supply this will, at the very least, give them a significant cashflow advantage and might amount to an annual overcharge running to millions of pounds.

Can I suggest all Npower customers
1. scrutinize your price change bills to ensure they have been produced fairly.
2. check the quarterly and annual allocation of Primary units.
3. make sure your bill is prepared accurately and that you understand it fully.

me to.
npower bill states that the primary units of electric 728kw per year are split equally over 365 days, so thats 2kw per day

this is what my bill says

on my bill it says first 32 units over 16 days charged at 13.63p
next 9 units at 19.07p

so 2 units per day x 16 days = 32 units as bill says ok

then it says first 27 units over 6 days charged at 13.63p
next 13 units at 10.07p

so should it not be first 12units at 13.63p then next 28 units at 10.07p

6 days x 2 units = 12 does it not !!

or im i going mad

Lester_Squair

Thanks for the feedback.

According to their own information Npower allocate primary units as follows

Electricity 60.7kWh per calendar month or approximately 2Kwh per day. Rather than allocating units per day, they actually suggest that they apply a simple apportionment i.e. number of billing days in the month divided by the total number of days in that month multiplied by 60.7 rounded up to the nearest whole number.

So, for electricity on a split bill ( i.e. price change) I was billed from 6/7 to 30/9 =86 days and 30/9 to 5/10 = 5 days or 91 days in total. The primary units in the first period would be ( using the 2 units per day) 172Kwh and for the 5 day in October 10 kWh or ( being a pedant) (25/31*60.7)+60.7+60.7=169.3 or 170kWh. for the second period this would be (5/31)*60.7=9.8 =10kWh.

So 170+10=180kWh which is the amount accounted for by Npower over the bill period but they have split in in their favour 158 at the previous charge rate to 22 at the new higher rate. I have tried to reconcile this approach both with their advice on calculating bills and common sense but cannot find any correlation.

The gas bill is even more complicated and the Npower arithmetic on this bill even more unfathomable. In fact, using their own advice gives a completely different number of units to be charged at the respective primary rates and, yes, I have used the seasonal adjustment they apply ( July , August and September account for 1% of the annual total allowance for gas, October 5.93%).

According to Npower the correct allocation of the annual allowance of 4572kWh of gas should result, for the above bill, in 128 kWh for the first period and 41kWh for the second (169kWh total) - their formula from their guidance notes. NOT 119kWh and 96kWh (215kWh total)! - a 27% overstatement! with more that twice the correct number of units being charged at the new price!

OK, I know I am making a lot of noise about what amounts to only couple of quid but, how many other bills are wrong?

Npower have agreed they are wrong and will re-issue my bill. However, they don't think there is anything fundamentally wrong with their system and therefore will not be voluntarily reviewing any other accounts. Please check and complain as appropriate!

meggsy

This is probably the answer, it has happened before :mad:

"We’ve made a huge investment - £200m – in the very core of our customer services; this summer we’ll begin moving our entire customer base to a whole new system. This commitment to invest in new technology shows npower’s dedication to improving its customer service. The new system will greatly improve customer experience, but we’re also aware that such a huge transition brings with it the potential risk of disruption to customers during the change so checks will be put in place to ensure minimum disruption to our customers"

http://thebrighterenergydebate.npower.com/customer.aspx

energysavingexp

Lester_Squair wrote: »

Thanks for the feedback.

According to their own information Npower allocate primary units as follows

Electricity 60.7kWh per calendar month or approximately 2Kwh per day. Rather than allocating units per day, they actually suggest that they apply a simple apportionment i.e. number of billing days in the month divided by the total number of days in that month multiplied by 60.7 rounded up to the nearest whole number.

So, for electricity on a split bill ( i.e. price change) I was billed from 6/7 to 30/9 =86 days and 30/9 to 5/10 = 5 days or 91 days in total. The primary units in the first period would be ( using the 2 units per day) 172Kwh and for the 5 day in October 10 kWh or ( being a pedant) (25/31*60.7)+60.7+60.7=169.3 or 170kWh. for the second period this would be (5/31)*60.7=9.8 =10kWh.

So 170+10=180kWh which is the amount accounted for by Npower over the bill period but they have split in in their favour 158 at the previous charge rate to 22 at the new higher rate. I have tried to reconcile this approach both with their advice on calculating bills and common sense but cannot find any correlation.

The gas bill is even more complicated and the Npower arithmetic on this bill even more unfathomable. In fact, using their own advice gives a completely different number of units to be charged at the respective primary rates and, yes, I have used the seasonal adjustment they apply ( July , August and September account for 1% of the annual total allowance for gas, October 5.93%).

According to Npower the correct allocation of the annual allowance of 4572kWh of gas should result, for the above bill, in 128 kWh for the first period and 41kWh for the second (169kWh total) - their formula from their guidance notes. NOT 119kWh and 96kWh (215kWh total)! - a 27% overstatement! with more that twice the correct number of units being charged at the new price!

OK, I know I am making a lot of noise about what amounts to only couple of quid but, how many other bills are wrong?

Npower have agreed they are wrong and will re-issue my bill. However, they don't think there is anything fundamentally wrong with their system and therefore will not be voluntarily reviewing any other accounts. Please check and complain as appropriate!

hi you seem to know how to work it out can you please explain mine to me thanks

14/9/11 179kwh to 30/9/11 220kwh =41kwh first 32 at 12.73p

next 9 at 9.40p

30/9/11 220kwh to 6/10/11 260kwh =40kwh first 27 at 13.63p

next 13 at 10.07p

thanks

ps also looking at the dates it says that i have used 41kwh over 16 days then i have used 40kwh over the next 6 days ? at the new price

Lester_Squair

According to my calcs your primary units should be 34 for the first period (17 days at 2kWh per day or (17/30)*60.7) and 12 units for the second period. Therefore the bill should look like

First 34 @12.73 = £4.38
Next 7 @ 9.40 = £0.62
and for the second period
first 12 @16.63 = £1.95
next 28@10.07 = £2.84

Add both sets together to get a total. Multiply by 1.05 (to get the VAT inclusive figure ) and that should be the bill total.

However, as you correctly point out the 6 days in October have been arbitrarily skewed so that you have "used" the same in 6 days as you did in the previous 17 days ( I am assuming that the 30/9/11 figure is an estimate and not a meter reading.

In which case I would suggest that the total units from 14/9 to 6/10 be apportioned on a straight line basis. Thus

Total units = 81 divide by total days ( 17+6=23) =3.5217kwh per day
Therefore first period = 59.87 units say 60 and second period =21 units
Apply the same rational above and

First 34 @12.73 = £4.38
Next (60-34)=26 @ 9.40 = £2.44
and for the second period
first 12 @16.63 = £1.95
next 9 @10.07 = £0.91

The difference between the above to calculations is only around 12p and 24p in your favour (on the total VAT inclusive bills) , based on the calculation you have set out. However, that's over a a very short period and more than 1p per day. Npower have many, many customers and if they are taking on average an extra 1p per day that is a worthwhile sum.
Perhaps 24p isn't worth the time to query it ? However, email is free!

( looking at the calculations I think Npower may be double counting the middle day 30/9 as it counts as a whole day on both parts of the equation - according to your bill - shurely some misteak!)

energysavingexp

Lester_Squair wrote: »

According to my calcs your primary units should be 34 for the first period (17 days at 2kWh per day or (17/30)*60.7) and 12 units for the second period. Therefore the bill should look like

First 34 @12.73 = £4.38
Next 7 @ 9.40 = £0.62
and for the second period
first 12 @16.63 = £1.95
next 28@10.07 = £2.84

Add both sets together to get a total. Multiply by 1.05 (to get the VAT inclusive figure ) and that should be the bill total.

However, as you correctly point out the 6 days in October have been arbitrarily skewed so that you have "used" the same in 6 days as you did in the previous 17 days ( I am assuming that the 30/9/11 figure is an estimate and not a meter reading.

In which case I would suggest that the total units from 14/9 to 6/10 be apportioned on a straight line basis. Thus

Total units = 81 divide by total days ( 17+6=23) =3.5217kwh per day
Therefore first period = 59.87 units say 60 and second period =21 units
Apply the same rational above and

First 34 @12.73 = £4.38
Next (60-34)=26 @ 9.40 = £2.44
and for the second period
first 12 @16.63 = £1.95
next 9 @10.07 = £0.91

The difference between the above to calculations is only around 12p and 24p in your favour (on the total VAT inclusive bills) , based on the calculation you have set out. However, that's over a a very short period and more than 1p per day. Npower have many, many customers and if they are taking on average an extra 1p per day that is a worthwhile sum.
Perhaps 24p isn't worth the time to query it ? However, email is free!

( looking at the calculations I think Npower may be double counting the middle day 30/9 as it counts as a whole day on both parts of the equation - according to your bill - shurely some misteak!)

thanks for that

goes to show its not me getting it wrong its them

as you say if they do this with everone they are quids in

thanks again

Lester_Squair

Thanks happy to help and, like you, I thought it was me that was wrong!

For absolute clarity, notwithstanding the very clear and concise information provided by Npower on-line in their step by step guides, they tell me that they are actually permitted to vary the allocation of primary units - provided that they do not exceed the total allocation in any one year.

Again, this doesn't strike me as altogether fair. If they can do that then they could "load" the allocation towards the beginning of any annual accounting period ( or at price change!) to secure an advantage and penalise any customers who might wish to leave within that accounting year.

Coupled with their clearly erroneous calculation of the apportionment of units between two different tariff periods, one would almost think this is a deliberate effort to skin the customer.

I'd love to hear from other Npower consumers as I'm thinking that this has been going on for some time - at least since their new core investment in new computing technology - shows that you don't necessarily get what you pay for! - in every respect. Does the ombudsman need to get involved?