Economy Energy raising gas unit charge by 88%

Sterlingtimes

Question.

If an energy supplier becomes insolvent then OFGEM provides a safety net and all credit will be secured.

But what happen if a customer switches and at a later date the energy supplier from which the client has switched becomes insolvent? Does the client just become an unsecured creditor and lose any credit (which could be hundreds of pounds)?

Sterlingtimes

The_Big_Bamboo wrote: »

I really wouldn’t blame anyone for jumping ship quickly;...I reckon I would too if I was an Economy customer given that energy prices from other ‘reputable’ suppliers are on the up.

However, if EE’s underhand strategy succeeds it will set a dangerous precedent for anyone on a fixed rate tariff. I’ve no doubt several other energy suppliers are watching developments with interest.

EE are apparently making a mockery of the entire industry;...i.e. “a fixed tariff is only fixed until we decide it isn’t,...and sod what your customer contract says! ”

I am inclined not to switch because this provides a safety net if Economy should become involvent. Otherwise, I am minded to take this as far as is necessary including sueing if the need arises.

brewerdave

Sterlingtimes wrote: »

Question.

If an energy supplier becomes insolvent then OFGEM provides a safety net and all credit will be secured.

But what happen if a customer switches and at a later date the energy supplier from which the client has switched becomes insolvent? Does the client just become an unsecured creditor and lose any credit (which could be hundreds of pounds)?

As I have recently found out, part of the deal when Octopus became responsible for IRESA customers, was that they would settle the credits of ex Iresa customers even after they had complete a move away. See

https://www.ofgem.gov.uk/publications-and-updates/iresa-customers-your-questions-new-supplier-octopus-energy


I presume that OFGEM would seek to impose this condition on any supplier of last resort.:)

alanb122

The Ofgem site provides a link to Citizen's Advice Bureau. I have used the CAB online form to request an answer to the question whether credit balances with a former energy supplier are protected. I will share the answer with this forum when it comes. Meanwhile I am leaving EE. I am not one of the ones who was mis-sold the Switch Saver tariff but I have had various other problems with them too lengthy to go into here.

Sterlingtimes

brewerdave wrote: »

As I have recently found out, part of the deal when Octopus became responsible for IRESA customers, was that they would settle the credits of ex Iresa customers even after they had complete a move away. See

https://www.ofgem.gov.uk/publications-and-updates/iresa-customers-your-questions-new-supplier-octopus-energy


I presume that OFGEM would seek to impose this condition on any supplier of last resort.:)

Thank you, BrewerDave. That is a helpful link that I did not find through my own searching. It is a good authority and reassuring.

Sterlingtimes

alanb122 wrote: »

The Ofgem site provides a link to Citizen's Advice Bureau. I have used the CAB online form to request an answer to the question whether credit balances with a former energy supplier are protected. I will share the answer with this forum when it comes. Meanwhile I am leaving EE. I am not one of the ones who was mis-sold the Switch Saver tariff but I have had various other problems with them too lengthy to go into here.

Thank you, Alan, for doing this. I would be very interested in their answer.

Sterlingtimes

I think that there is a good chance that a client who switches from Economy to a replacement supplier under duress, where there is a serious breach of contract and a failure to communicate correctly would be entitled to damages equivalent to the price of the new supplier less the price of the Economy's fixed-price contract.

tg99

OFGEM reforms in 2013:

1. Fixed term contracts

Suppliers will be banned from increasing prices, or making other changes to fixed term contracts which are to the disadvantage of a customer. The only exceptions to this are “tracker” tariffs that follow an independent index over which the supplier has no control, or structured price increases set out in advance which are fully in line with consumer protection law. This new rule applies to any contracts entered into on or after July 15 2013.

Suppliers will be required to notify customers that their current fixed-term is coming to an end between 42 and 49 days before the contract ends.

Between this notification period and the end of the fixed term contract, suppliers will be banned from charging a termination fee should the customer decide to switch.

Suppliers will be banned from automatically rolling a customer over onto a further fixed term contract.
Instead suppliers will be required to default customers to an evergreen contract if the customer takes no switching action before the end of their fixed-term contract (this default contract must be the cheapest evergreen tariff with the supplier from 31st March 2014).

Sterlingtimes

Thank you, tg99. This is very helpful.

I have just written to my MP, Dame Caroline Spelman. She has a good reputation for helping people.

glennevis

"Suppliers will be required to notify customers that their current fixed-term is coming to an end between 42 and 49 days before the contract ends."

In my case my fixed tariff was supposed to end on 13th July. I had no contact from them during the fixed period.
EE advised me by letter (not email) that my tariff was increased massively. The letter was dated 2nd August and the tariff change was BACKDATED to 1st August. A clear breach of T&Cs and Ofgem rules. They are refusing to accept they are in the wrong.