New business premises: billed out of contract rates

AB1982_2

Hi everyone

Don't know if anyone can advise at all. We moved into new premises in January and it's taken us a while to get on top of everything, including sorting out our electricity supplier. We were contacted by the existing supplier for the premises, Opus Energy, who supplied the previous tenants. They gave us a quote and I then looked around for some other quotes before getting back to them. I got a cheaper quote from GB Energy and Opus then agreed to reduce their quote in order to compete. Although still slightly more expensive than GB, Opus' offer was a 3 year fixed rate compared to GB's variable rate, which seemed safer, so I agreed to it. I was advised that this rate will work out at around £90-95 per month (including VAT).

I'm happy enough moving forward with the quote they provided, however they have billed us for the first 3 months of our occupancy in the premises at 'out of contract' rates, which comes to £654.04 for just under 3 months - more than double the rate we have agreed. So my question is, do I have grounds for asking them to reduce the rate at which we have been billed up to now? Or can they charge pretty much what they want? I had not entered into any contract with them before agreeing the new rate today (we received the bill a few weeks ago). They did tell me that they would give me 20% off the bill if I paid it in its entirity today but that still works out pretty expensive and burns quite a hole in my pocket!

Would appreciate any guidance.

Thanks for your time

AB

footyguy

AB1982 wrote: »

Hi everyone

Don't know if anyone can advise at all. We moved into new premises in January and it's taken us a while to get on top of everything, including sorting out our electricity supplier. We were contacted by the existing supplier for the premises, Opus Energy, who supplied the previous tenants. They gave us a quote and I then looked around for some other quotes before getting back to them. I got a cheaper quote from GB Energy and Opus then agreed to reduce their quote in order to compete. Although still slightly more expensive than GB, Opus' offer was a 3 year fixed rate compared to GB's variable rate, which seemed safer, so I agreed to it. I was advised that this rate will work out at around £90-95 per month (including VAT).

I'm happy enough moving forward with the quote they provided, however they have billed us for the first 3 months of our occupancy in the premises at 'out of contract' rates, which comes to £654.04 for just under 3 months - more than double the rate we have agreed. So my question is, do I have grounds for asking them to reduce the rate at which we have been billed up to now? Or can they charge pretty much what they want? I had not entered into any contract with them before agreeing the new rate today (we received the bill a few weeks ago). They did tell me that they would give me 20% off the bill if I paid it in its entirity today but that still works out pretty expensive and burns quite a hole in my pocket!

Would appreciate any guidance.

Thanks for your time

AB

As you know, business is all about negotiation as you have already successfully demonstrated by obtaining a reduction in the initially quoted tariff.

So there is certainly nothing stopping you attempting to negotiate over the out of contract supply cost.

Whether the supplier will be so obliging this time would be another question. Why should they consider lowering the price from the out of contract tariff they publish?
20% off has already been offered. That would appear very generous indeed. Do you really think you could get a bigger discount?

AB1982_2

footyguy wrote: »

Why should they consider lowering the price from the out of contract tariff they publish? 20% off has already been offered. That would appear very generous indeed. Do you really think you could get a bigger discount?

It depends what you mean by "publish". We had a call from them a few weeks ago when they gave us a quote for a contract, then this bill arrived a few days later for the 'out of contract' period. It's not about haggling - my question is whether it is fair for them to charge such a higher rate for the period before I agreed a contract with them. I can't see how it would cost them any more to supply electricity during this period than it does now that we have a contract with them. As well as the fact that the rate on this bill is more than double the rate they have now agreed to, the fact that it was so quick and easy to negotiate a 20% discount (she couldn't have agreed to this any quicker) further indicates that they are clearly making a lot more money on this bill than they need to, so what I am wondering is whether there is anything I can say/do to force their hand to any extent, or whether it really is a simple case of them being able to charge whatever they want to for their 'out of contract' rates.

footyguy

AB1982 wrote: »

It depends what you mean by "publish". We had a call from them a few weeks ago when they gave us a quote for a contract, then this bill arrived a few days later for the 'out of contract' period. It's not about haggling - my question is whether it is fair for them to charge such a higher rate for the period before I agreed a contract with them. I can't see how it would cost them any more to supply electricity during this period than it does now that we have a contract with them. As well as the fact that the rate on this bill is more than double the rate they have now agreed to, the fact that it was so quick and easy to negotiate a 20% discount (she couldn't have agreed to this any quicker) further indicates that they are clearly making a lot more money on this bill than they need to, so what I am wondering is whether there is anything I can say/do to force their hand to any extent, or whether it really is a simple case of them being able to charge whatever they want to for their 'out of contract' rates.

As per their supply terms, published means as displayed on their website or otherwise notified to you from time to time.

Yes it is fair and justifiable for the supplier to charge different (higher) deemed rates than the rates they agree with you when you agree to a fixed term contract with them (and the terms associated therewith)

Edit:
There are numerous reasons why prices may be higher for a customer served under a deemed contract
e.g.
Presumably without a fixed contract, there is no Direct Debit in place, meaning probable higher collection costs for the supplier.

When an energy supplier has to supply a customer who doesn’t have a contract, they have to commit to buying a short term energy supply, which can be pricey, as wholesale prices can change regularly.

etc, etc.