First Utility new exit fee scam switching tariffs

System

C_Mababejive wrote: »

Do FU honor the 49 day switch period or do they try and charge within that period also? What about the general compliance of other providers with this rule?

It is actually a 49 to 42 day rule. All suppliers are required to notify customers that a fixed contract is coming to end BETWEEN 49 to 42 days before the contract end date. Once the notification is received, then the supplier would be in breach of its supply licence if it failed to waive the exit fee.

The lack of notification also puts the supplier into a licence breach - again exit fees cannot be charged.

Muttleythefrog

footyguy wrote: »

As regards charging an early exit fee for switching tariff, there are many suppliers that do this. It is not a scam if it is clear from the outset in the terms that this will occur.

It sadly isn't clear.... I've just stumbled on this thread after doing my usual regular tariff comparison on FU website. I've been with FU for a while now and the terms have always stated we may charge an early exit fee. Until today I have always been reassured this would be waived as the site did include the advice quoted above that fee is waived provided a longer deal in entered into.. for practical purposes this also included deals ending same date... in fact I switched from version 2 to version 3 to version 4 of a tariff without exit fees. However the waiver advice seems to have disappeared and as above they do now appear to be charging exit fees more extensively. Sadly it isn't that clear.... just as it previously wasn't. As so often with these companies... information isn't always clear. But £60 exit fees is a game changer in comparison and will impact choices I make as the deal nears end.

phillw

wavelets wrote: »

When you entered the original fixed price contract, the supplier needed to purchase that energy on the wholesale market at a fixed price (or at least reserve it from a purchase they have previously made)

When you now effectively cancel that contract early, the supplier is left with a load of energy they need to try and sell ... and at a time of falling wholesale prices, the energy the need to sell they have paid a relatively lot of money for.

If you switch six months into a 1 year fix to another 1 year fix then you aren't cancelling as you are still a customer, you are just renegotiating the price and increasing the term. If you switched from a 3 year fix to a 1 year fix then obviously I would expect an exit fee as you are trying to exit early.

They are suggesting the new tariff because of the recent ofgen rules, but if that calculation doesn't include any termination fees then that is insane. Especially as the calculations are designed to calculate the next 12 months cost, which some of those are at a rate that you are unlikely to ever pay.

footyguy

Muttleythefrog wrote: »

It sadly isn't clear.... I've just stumbled on this thread after doing my usual regular tariff comparison on FU website. I've been with FU for a while now and the terms have always stated we may charge an early exit fee. Until today I have always been reassured this would be waived as the site did include the advice quoted above that fee is waived provided a longer deal in entered into.. for practical purposes this also included deals ending same date... in fact I switched from version 2 to version 3 to version 4 of a tariff without exit fees. However the waiver advice seems to have disappeared and as above they do now appear to be charging exit fees more extensively. Sadly it isn't that clear.... just as it previously wasn't. As so often with these companies... information isn't always clear. But £60 exit fees is a game changer in comparison and will impact choices I make as the deal nears end.

From their terms

8.1 If your contract with us has a fixed term period and you terminate the contract before this period has expired, you may have to pay an early exit fee.

and if you look at the additional specific terms for a fixed contract, you will probably also see something like this (at least I did)

This Contract has a fixed price during the fixed term period which is up until 30 April 2016. ... If you or we end this Contract before 12 March 2016 we may charge an early termination fee of £30 per fuel.

(obviously actual dates will depend on terms applicable)

I'm not sure how much clearer a supplier could make it. As you can see, these were terms from about 10 months ago.

benny_boy

footyguy wrote: »

From their terms
and if you look at the additional specific terms for a fixed contract, you will probably also see something like this (at least I did)
(obviously actual dates will depend on terms applicable)

I'm not sure how much clearer a supplier could make it. As you can see, these were terms from about 10 months ago.

yes it is clear in the terms and conditions but this does not change the fact that in the past they did not charge exit fees if you move onto a longer tariff,but now they do,and they have made the change without notifying customers of it.

Muttleythefrog

footyguy wrote: »

From their terms
and if you look at the additional specific terms for a fixed contract, you will probably also see something like this (at least I did)
(obviously actual dates will depend on terms applicable)

I'm not sure how much clearer a supplier could make it. As you can see, these were terms from about 10 months ago.

lol. it's not clear at all.. they use the word "may".. i.e... they might.. or they might not.. and in the past in my changes of tariffs that has meant won't. They should expressly state when exit fees WILL be charged... if people here and myself find this matter difficult to navigate then pity help their more vulnerable customers. Obviously here we're aware that they've changed the underlying rules... I presume most will be unaware as I was until today. I have always followed the guidance on their site... and since historically that was exit fees would be waived if you moved to a tariff with a later termination date... and my direct query confirmed that also includes same termination date (something the agent on the phone admitted was not clear and had to take guidance on himself)... that has always been what I've operated to. That guidance now appears deleted and new button on the site for acceptance of terms which again aren't clear... and sadly as pointed out their price comparison of tariffs given your circumstances does not include exit fees which rather defeats the point of the comparison or causes confusion. This industry is getting away with poor information... goodness knows who thought up the rather pointless TCR for example. Perhaps my blood still boiling with FU due to the problems they caused with my Solar PV installation... when they bizarrely.. as the only provider that I'm aware of who does it for free (i.e. they had something to boast)... caused me numerous delays and expense and arguments to the point they began refusing to speak to me... when I needed an isolation switch fitting and they passed me pillar to post denying knowledge or involvement. Poor training/information.

michaels

So the first time I switched 'within fixed period' from 1 FU deal to another I phoned FU to ask about this and they said the fee would not be charged so I switched and it wasn't. so then I switched again another 3 times and no fee charged.

A few days ago I switched to the April 17 v1 and low and behold today I get the email about the charge. Now what is interesting is the T&C about a longer fix because of course my last fix was for about 13 months and the April 17 is about 14 months so clearly longer so their 'you would need to switch to a 2/3 year fix' line would seem to be an oral statement which contradicts the T&C which just state a longer fix: 'These fees will be waived if a longer fixed price tariff with First Utility is selected'.

So there seem to be 2 options - argue this all the way to the ombudsman or cancel the switch and do a price comparison factoring the 'internal switch' fees and cashback available for moving elsewhere.

Perhaps it will deter a few from making internal switches but if it also results in more leaving FU altogether then it may well be a case of shooting themselves in the foot.

footyguy

michaels wrote: »

...
So there seem to be 2 options - argue this all the way to the ombudsman or cancel the switch and do a price comparison factoring the 'internal switch' fees and cashback available for moving elsewhere....

Or option 3...
Stay on the deal you have agreed to and were presumably happy with (notwithstanding you failed to read and agree the terms you confirmed you did) until it expires, and then consult a comparison site to find the best deal for you again at that time.

mnevis

Sorry about this as MSE site will not let me create a new thread. I have complained to Npower and they have not responded to my complaint other than sending me the same bill over and over again, the bill is in dispute, and adding charges to the bill fand threatening to cut me off, 8 weeks have passed I am using Resolver. What is my next step please?

footyguy

Muttleythefrog wrote: »

It sadly isn't clear.... ..

benny_boy wrote: »

yes it is clear in the terms and conditions ....

Muttleythefrog wrote: »

lol. it's not clear at all..

Looks like you are on your own, Muttley ... :rotfl: