Forced to sign heating agreement on day of completion

espritlibre87

We have lived in our new flat for almost three months, having exchanged in early April and completed a few days later.

On the day of completion we were issued with a Heating Supply Agreement and told we had to sign it in order to complete. Whilst we had been made aware in the lease that we would have no choice over our heating supplier, this was the first time we had been informed of just how much the 'district heating system' would be costing us. We were already halfway through moving - the email from the solicitor literally came through whilst we were loading up the van we had paid for. However, at this point we had already exchanged and paid a deposit of £60,000, handed over our legal fees, and paid a month and a half's rent upfront (it's a shared ownership property). We had a choice - sign up to the heating agreement, or refuse, and lose out on an obscene amount of money and our new home.

We've now received the bill for the first quarter - £109, of which just £15 has actually been spent on heat energy (hot water for showers). The standing charge/capital replacement fund cost almost six times the amount we are paying for the energy we've used. Our flat is well insulated and pretty much permanently hot (even during recent storms where the temperature outside was freezing). It soaks up sunlight during all daylight hours and is boiling all night. Even when we reach winter, I honestly don't see us needing to put the heating on very much if at all. One of the attractions of this flat was the advertised energy efficiency. Instead, we are now facing bills far higher than when we lived in a three-bedroom house with a crappy old boiler.

I honestly feel completely trapped right now. Yes, we signed the agreement - but I don't see what other choice we had, besides lose all of our savings, the money we'd spent on legal/moving fees, and of course the flat itself (we were also sofa-surfing at the time so would have literally been back to square one, with no deposit behind us even to rent somewhere). I feel like we were forced into this at the last minute, with all parties fully aware we were in no position to refuse. I have no idea what rights we have right now but I cannot understand how it is acceptable to charge us such an extortionate amount relative to the energy we've actually used. I am well aware of the 'benefits' of the standing charge/capital replacement fund, but given the choice I would go without and use a standard boiler. I feel like we have no choice in this situation at all, nor any rights, and it is causing both of us huge amounts of stress knowing we are going to be ripped off every single month, when we are unlikely to use more than around £20-25 of energy per quarter.

If anybody here has a similar experience, or any knowledge at all of any way we can change things, I would be really grateful for your advice. We feel completely scammed right now.

boliston

36 a month does not sound too bad for heat and hot water - i would quite like to not have the worry about annual servicing and replacement costs - a lot of tenants in my block have replaced boilers after only 10 years which i would imagine must cost a good thousand or more

espritlibre87

But we're only actually using around £5-6 a month. The rest is the standing charge. One of the things we were looking forward to when moving to a new build was reduced energy costs due to the supposed efficiency. Instead we're paying more than we ever have before.

System

You need to bear in mind that you are paying for the capital cost of a district heating scheme, ongoing maintenance and replacement. I have just had to spend a few £000s on a new boiler which will not be something that you will ever have to pay for. That said, these types of heating schemes appear to be skewed towards the provider and not the end user. This article sums up the issues:

https://www.theguardian.com/money/2017/feb/05/district-heating-fuel-bill-regulation

Cardew

If you feel you have a grievance, then you should take it up with your solicitors as they should have made the position clear before exchange of contracts.

Personally I think £91 a quarter(£30 a month) for standing charge and capital replacement fund is a good deal.

matelodave

How much are they charging per kwh

espritlibre87

5.07p.
I'm less concerned by the actual usage charge as we use so little. I'm just disappointed that we moved into a new build expecting energy efficiency and therefore lower bills. We had (perhaps naively) assumed there would be a new boiler with a warranty, rather than all these additional charges. The building has nearly 100 units so the energy company must be making a fortune from the standing charges/capital replacement fund?

footyguy

espritlibre87 wrote: »

We have lived in our new flat for almost three months, having exchanged in early April and completed a few days later.

On the day of completion we were issued with a Heating Supply Agreement and told we had to sign it in order to complete. Whilst we had been made aware in the lease that we would have no choice over our heating supplier, this was the first time we had been informed of just how much the 'district heating system' would be costing us. We were already halfway through moving - the email from the solicitor literally came through whilst we were loading up the van we had paid for. However, at this point we had already exchanged and paid a deposit of £60,000, handed over our legal fees, and paid a month and a half's rent upfront (it's a shared ownership property). We had a choice - sign up to the heating agreement, or refuse, and lose out on an obscene amount of money and our new home.

We've now received the bill for the first quarter - £109, of which just £15 has actually been spent on heat energy (hot water for showers). The standing charge/capital replacement fund cost almost six times the amount we are paying for the energy we've used. Our flat is well insulated and pretty much permanently hot (even during recent storms where the temperature outside was freezing). It soaks up sunlight during all daylight hours and is boiling all night. Even when we reach winter, I honestly don't see us needing to put the heating on very much if at all. One of the attractions of this flat was the advertised energy efficiency. Instead, we are now facing bills far higher than when we lived in a three-bedroom house with a crappy old boiler.

I honestly feel completely trapped right now. Yes, we signed the agreement - but I don't see what other choice we had, besides lose all of our savings, the money we'd spent on legal/moving fees, and of course the flat itself (we were also sofa-surfing at the time so would have literally been back to square one, with no deposit behind us even to rent somewhere). I feel like we were forced into this at the last minute, with all parties fully aware we were in no position to refuse. I have no idea what rights we have right now but I cannot understand how it is acceptable to charge us such an extortionate amount relative to the energy we've actually used. I am well aware of the 'benefits' of the standing charge/capital replacement fund, but given the choice I would go without and use a standard boiler. I feel like we have no choice in this situation at all, nor any rights, and it is causing both of us huge amounts of stress knowing we are going to be ripped off every single month, when we are unlikely to use more than around £20-25 of energy per quarter.

If anybody here has a similar experience, or any knowledge at all of any way we can change things, I would be really grateful for your advice. We feel completely scammed right now.

This really is something your conveyancing solicitor should have warned you of, and identified the amount you would be making youseelf liable to before you even exchanged.

In the first instance, revert to your conveyancing solicitor.
Hopefully that will resolve issues.

Otherwise, it may be you need to seek independent legal advice on the potentially poor/inadequate service you were given by your coneyancing solicitor. You pay a lot of money for the service, and that is to avoid things going wrong (and in the unlikely event they do, they are liable!)