Student Bills Package Quantum NRG

QuestionsQuestions

My daughter and 2 friends began their tenancy this July with a bills package from Quantum NRG. They were paying £83 each a month for water, internet gas and electric - so this was already £2,988 for the year. Today they got an email saying they are increasing the DD to £132 a month and this includes the money from the energy bill support scheme. I am flabbergasted. This means they will be expected to pay nearly 5k for the bills for a small (originally 2 bed but downstairs living room now a bedroom) terraced house. This is exploitation. For the rest of my family (4 of us) in a substantially larger house we are only paying 150.00 per month for gas/electric (and 73 on water/internet) - so is near enough half of what they are expecting to pay. I am livid - what are their rights in getting out of this contract - students are not getting any extra cash for these hikes so it is only the fat cats who are benefitting - i'm sure i read somewhere that if they change the tariff I can opt out of the contract without a fee? can anyone please advise?
Thanks all

[Deleted User]

I would start by saying approaching this with words like "exploitation", "livid" and "fat cats" is completely the wrong approach.  Find some actual facts, present them to us and we can try and help.

First question - was it a fixed price contract or not?  If it was not, then the price for energy is going up by 27% (on average) in October anyway.

Secondly - was it based on any sort of estimated usage?  If so, how has the actual usage compared to the estimate?  If they are using more, and it wasn't an "unlimited" deal, then the price should go up.  Even with "unlimited" deals, there is often a fair use clause or level beyond which a price increase is triggered.

We don't know their contract, only they have the terms and conditions.

edit: Also, I can't find any reference to Quantum NRG as an energy or services supplier.  Could you point us to a website or something where we can investigate for details?

QuestionsQuestions

You're right about the use of vocabulary - but I am so upset for these young people. It is not something I would write in any correspondence.

Quantum NRG Ltd.

Open Space

Interfields

Malvern

Worcestershire

WR14 1UT

UNITED KINGDOM

The company cannot be contacted via telephone.
Today I spoke to the letting agency who endorse the company by offering them as the bills inclusive provider to their tenants, I asked if they could contact them on our behalf as they had not responded to a previous email regarding the new tariff - they said they cannot contact them by phone only email!
Yesterday the D/Debit invoice was sent out for the 83.20 payment - stating:
"We will notify you via email at least 3 working days in advance of any changes to your payment date or amount."
Today they sent an invoice dated 

Invoice Date

1 Sep 2022

Amount Due 132.86

Due Date 30 Sep 2022

Which would seem to be less than the 3 days they have stipulated!
IN their invoice today they give the charges as a fixed term tariff (see below)

Here is details of our latest price (Fixed Tariff)

Electricity
Tariff name: QUANTUM Ensured
Tariff type: Fixed
Payment method: Monthly Direct Debit
Unit Price: 59.2p/ kWh
Standing Charge: 52.5p/ day
Tariff ends on: 30/06/2023
Tariff guaranteed until: 30/06/2023

Gas
Tariff name: QUANTUM Ensured
Tariff type: Fixed
Payment method: Monthly Direct Debit
Unit Price: 25.97p/ kWh
Standing Charge: 57.75p/ day
Tariff ends on: 30/06/2023
Tariff guaranteed until: 30/06/2023

Your Direct Debit is calculated by the estimated cost for the duration of your tenancy, with seasonal use factored in.

Will the change take into consideration the £400 Energy Bills Support Scheme (EBSS) from October?

The Energy Bills Support Scheme (EBSS) payment will be credited into our customer’s account Please note that The Energy Bills Support Scheme(EBSS) has already been taken into consideration for your projected annual usage, thus, our new amount already included the EBSS.

Whereas the information in the original contract is less clear: (see below)

Product Summary

“Bills Inclusive Service” is a monthly/yearly subscription service. Please note the contractual period must coincide with the start and date end on your tenancy agreement.

Customers will set up direct debit with us once the order has been put in, where there are multiple residents within a property, they are all joint and severally liable for the full Package cost. The package cost is in the

unit per household.

Fair Usage term is included as standard within the subscription cost.

Additional charges may be raised at any time for early termination, broadband installation charges, missed payment charges, meter reading operative visits, extra broadband and media services used or over usage on

water service.

Bill Management Services: the services that we agree to provide to you as set out in the Order form

Gas and Electricity Price as follows:

Gas Unit Price: 0.0856 per kwh, standing charge 0.8399 per day

Electricity Unit Price: 0.3677 per kwh, standing charge 0.8391 per day.

The bills‐inclusive package is priced according to energy contracts priced at the commencement of the tenancy and if those prices should increase during the term for any reason then the tenants will pay an additional

sum to reflect the increased costs, we will inform you within 30 days if there are any changes.

This is the blurb regarding changing contract prices - does this mean that we can opt out of the contract without paying the £450 exit fee?

What happens if we change the contract or raise prices

If we make a change to this contract and that change puts you at a disadvantage, or if we raise prices, we’ll write to let you know at least 30 days before the change or price rise happens.

The change or price rise won’t affect you if:

• you end your current contract with us and then begin a new contract with us 20 working days after the change or price rise happened;

• you arrange for another company to supply your gas and electricity, and the new supplier tells us about this within 20 working days after the change or price rise has happened. That company has to begin

supplying your gas and electricity reasonably soon after telling us.

If you switch to another supplier, you have to pay us any money you owe under the current contract. If you owe us money, we’re within our rights to stop you switching to another supplier. When we tell you that

we can stop you switching, you need to pay us within 30 working days. If you don’t, you’ll have to accept the change or pay the higher prices.

This clause doesn’t apply if your price increase is a result of changing the way you pay us (for example if we install a prepayment meter or your credit or debit card payment authority has been changed).

The contract also states:

If we change your terms and conditions in any way that could have a detrimental impact we will write to you and let you know at least 30 days in advance.

If we make a change to this contract and that change puts you at a disadvantage, or if we raise prices, we’ll write to let you know at least 30 days before the change or price rise happens.

They sent an email on 6th September stating they would be raising prices but nothing about how much and when - so an increased invoice today after the original invoice yesterday does not seem to honour their 30 day period - would you agree?

I do hope there is some information here that will mean something favourable for these young adults.
Thanks in advance.

[Deleted User]

Reading that, I see a few critical points.

Firstly, the EPG cap does not apply (it is not a standard variable rate tariff).

The contract states that the fixed price of electricity they offer is based on the price at which they can buy the electricity.  It then states that if this price changes, they are allowed to change the fixed price that they are offering and then they have 30 days to tell you the prices has gone up.

Nothing in the contract states that they will waive exit fees under any circumstances.

It also seems like there is confusion in terminology between the DD payment and the invoice.  Conventionally, each account will see credits (the DD payment) and debits (when the company actually charges for energy used).  Is this simply stating that you have paid £83 and then the next payment will be £132?  Or that the most recent debit from the account was £132 (regardless of the size of any DD made)?.

macman

I fail to understand why your daughter signed up to this bundled service, though the LA's motivation for suggesting it is obvious: they get a healthy commission fee for each sign up. Was she aware of this? 
Water is a regional monopoly at a fixed price, so there is no point in buying it through a third party, as there is only one supplier.
What you are ignoring is that the increase may well be due in part to higher than predicted usage: students do not have a great record when it comes to sensible use of heating and hot water. 
The solution to this, if possible, is to get out of the contract and buy their supplies from another provider using SVT under the cap.
It's not clear what the rates were on the original contract they agreed, but the ones you quote are insanely high.
Quantum NRG is not  a licensed energy supplier, it appears to be simply a broker/reseller. It's only 2 years old, works out of a serviced office, and employs just 3 people. It's not clear on what basis they can offer to sell to domestic customers, but I suspect this is by virtue of it being a bundled service?
https://find-and-update.company-information.service.gov.uk/company/12604406/officers
https://general-energy.co.uk/about-us/

QuestionsQuestions

I think she thought it would be a hassle free deal. Definitely didn't know the letting agent got a sign up fee. The original cost was:

Gas and Electricity Price as follows:

Gas Unit Price: 0.0856 per kwh, standing charge 0.8399 per day

Electricity Unit Price: 0.3677 per kwh, standing charge 0.8391 per day.

The bills‐inclusive package is priced according to energy contracts priced at the commencement of the tenancy and if those prices should increase during the term for any reason then the tenants will pay an additional sum to reflect the increased costs, we will inform you within 30 days if there are any changes.

The invoice yesterday was for £83 payable (as per the other invoices) 30th Sept and today they have upped it by £50 payable 30th Sept.

The increase is nothing to do with usage as they have only been in the property for 2 weeks, and have not had the heating on yet - its all to do with the october 1st rise.

Whats "SVT under the cap."?

What are her options please - is there anyway she can object to any of this? upping the direct debit from one day t the next and expecting payment 2 days later - or - not being told the agent was selling the package - i don;t know - I really feel for them and whether you like the term or not I feel they have been exploited for being green and not really understanding the minutiae of contracts and how these things work.

QrizB

QuestionsQuestions said:

The original cost was:

Gas and Electricity Price as follows:

Gas Unit Price: 0.0856 per kwh, standing charge 0.8399 per day

Electricity Unit Price: 0.3677 per kwh, standing charge 0.8391 per day.

That's a relatively sensible price. A bit high by August standards but not terrible.

Electricity: Unit Price: 59.2p/ kWh, Standing Charge: 52.5p/ day
Gas: Unit Price: 25.97p/ kWh, Standing Charge: 57.75p/ day

This, on the other hand, is crazy. The gas in particular is more than double the EPG capped rate for variable tariffs, and almost 70% above the proposed Ofgem capped rate.

It looks to me as though the agency have a commercial tariff, not a domestic one.

I'd be speaking with the CAB to see whether their contract with Quantum is even legal.

[Deleted User]

Seems like the price Quantum pay to buy the energy has gone up, and therefore as per the contract the price they are charging has gone up.  I don't think is anything to do with the 1 October rise, that's just a convenient point to apply it.

Contracts of this type are not covered by the 1 October cap.

SVT means "Standard Variable Tariff" - this sort of tariff is covered by the cap.

She can switch the whole house to another supplier and choose a different tariff (likely only the SVT is available, and probably only from Octopus or EdF at the moment) - but this will probably require paying the exit fee.  It does seem from the contract that if she does this then only the old prices would apply until the switchover happens.

As it's a bundled package, it would probably also need signing up for the other services with new suppliers also, so that's water, telephone, broadband etc.

They would all then need to decide whose name each contract was in and agree how to split the payments - it's only these bundling companies that offer the "split between housemates" thing, that's why they charge so much.

Sounds like an expensive way to learn the lesson of "actually read and understand contracts that you are going to sign", unless as QrizB suggests you find some way to claim the original contract was invalid (although I don't hold much hope for that personally).

macman

What date did your daughter sign the contract precisely? You say they moved in 'a couple of weeks ago': is it less than 14 days? If so, would cooling off apply, or is this considered to be a business contract? Does the provider need to be licensed to resell business supplies? 
The LA is under no obligation to reveal that they get a bung, but they don't just recommend an obscure service provider like this to be helpful. 

QuestionsQuestions

The contract was signed back in July - nobody has been in the house until September and no bill increases were mentioned which is why it has not come to my attention until now

ariarnia

might be worth talking to citizens advice? i know it's mobile phones and internet but it might be the same that when they increase the price you can leave without fee in the notice period (as it's a material change of contract)

if not then have you worked out where the break even point is leaving and paying the fee (given it's right at the start of the year and they might put it up agin in jan)!