Smart meters on the News - Being switched to prepayment without notice.

MattMattMattUK

Chrysalis said:

Deleted_User said:

Chrysalis said:

Ectophile said:

mr_stripey said:

Was covered in detail earlier this week but to to pick up on this point, I fail to see how not disconnecting someone could be inferred has "disconnection by the back door".

When someone is on a credit meter, but can't pay the bill, then disconnecting them for non payment involves a long process, and going through the courts.  The customer gets a chance to plead their case, and the energy company may find the court delays the disconnection.

Switch someone to prepayment, and as soon as they run out of credit on the meter (and run out of emergency credit), then the power goes off.  But it's called "self disconnection", so the energy company can deny any responsibility, and no court is involved.

So if you want to disconnect someone who simply can't pay, remotely switch them to prepayment, and their power will go off in a few days.

Well explained, it seems the fix for this is to still require a court order for remote changes to the smart meter.  The remote control should be a means of reducing physical labour but not bypassing the legal process.  So ofgem really has failed here (again) letting this happen.

That could be a decent fix - but I presume you mean changing someone onto prepayment remotely rather than needing a court order for every tariff change?

Has anyone actually got an example though, where a customer has been remotely changed onto prepayment without notice and without being in substantial debt that they have not agreed a plan to resolve?

This seems to be a stable door / horse thing again - surely the better answer is to deal with the situation before the customer is in massive debt, rather than worrying about what happens once they are?  Most of the media examples (of course, and not necessarily representative) have involved people who haven't paid their bill for several years and often haven't read their meter.

Notice isnt the issue here, its the bypass of legal process.

There is no bypass of a legal process, there is no legal process required. In theory there was never a legal process to fit a physical pre-payment meter either, the court order was for access to the premises to fit the meter, it was not permission to fit the meter itself which is not required.

Chrysalis said:

Of course preventative actions are always preferable, but what happens here?  Fixed DD system allows debt to be built up quite easy.  The only preventative action I can think of as a short term measure is requiring a good credit history to be on fixed DD billing, or to restrict fixed DD to a very low debt balance at which point action is taken at a much earlier stage.  

Preventative action in the short term would be submitting regular meter readings or having a smart meter report readings correlated against Direct Debits (things like EDF's 6 month billing cycle make that somewhat problematic), whole month billing/variable Direct Debit also solve the issue, although with seasonal fluctuations in bill amounts being difficult for some people.

There is a balance between not allowing customers to get into debt and also not requiring them to carry too much of a credit, the problem is it can be difficult for the suppliers to balance on an individual level as people are changing usage patterns, but they generally cannot win, people whinge if they get into debt, they also whinge if they have a large credit balance and they seem to whinge even more when they cannot understand that energy prices have gone up and that means that their monthly Direct Debit has to go up. A model which was pay monthly in full, or pre-pay would be the simplest overall to avoid the issues of debt or credit balances, unfortunately it also introduces other issues, hence the lack of a perfect answer. 

deano2099

MattMattMattUK said:

There is a balance between not allowing customers to get into debt and also not requiring them to carry too much of a credit, the problem is it can be difficult for the suppliers to balance on an individual level as people are changing usage patterns, but they generally cannot win, people whinge if they get into debt, they also whinge if they have a large credit balance and they seem to whinge even more when they cannot understand that energy prices have gone up and that means that their monthly Direct Debit has to go up. 

It's really easy. You just have a button on the account page that allows you to transfer any of the credit back into your bank account. I have no issues with various banks holding amounts of my money as they let me have it back quickly and easily.
And if I go overdrawn I have to sort that out immediately or the consequences are far worse than my energy account going into debt.
Your energy account is basically like a bank account and a big reason huge swathes of the public can't get their head around that is that the energy companies treat the money like its theirs, and not the customer's. Maybe if they let their customers treat it that way, the customers would start to understand it that way.

[Deleted User]

deano2099 said:

MattMattMattUK said:

There is a balance between not allowing customers to get into debt and also not requiring them to carry too much of a credit, the problem is it can be difficult for the suppliers to balance on an individual level as people are changing usage patterns, but they generally cannot win, people whinge if they get into debt, they also whinge if they have a large credit balance and they seem to whinge even more when they cannot understand that energy prices have gone up and that means that their monthly Direct Debit has to go up. 

It's really easy. You just have a button on the account page that allows you to transfer any of the credit back into your bank account. I have no issues with various banks holding amounts of my money as they let me have it back quickly and easily.
And if I go overdrawn I have to sort that out immediately or the consequences are far worse than my energy account going into debt.
Your energy account is basically like a bank account and a big reason huge swathes of the public can't get their head around that is that the energy companies treat the money like its theirs, and not the customer's. Maybe if they let their customers treat it that way, the customers would start to understand it that way.

Instantly take out all your credit - the next day January's energy bill arrives - then what?

Now in debt, DD not big enough to get you out of it (or needs to be raised).  Exactly the situation that suppliers are being told to avoid.

Petriix

There's mention in the original BBC article that people are being switched without any notification at all. One person was said to have a 'disputed debt'. From spending time on this forum we can all see countless cases where suppliers make mistakes and are very hard to contact. It is worrying that the same incompetent people could have easy access to change meters into pre-payment mode. Simply assuming that this is down to the individuals building up debt and not taking responsibility is extremely generous to the suppliers in question.

[Deleted User]

"Simply assuming" that there is a problem of devious suppliers switching people to prepayment without any notice or communication, in the hopes that they will self-disconnect is, on the other hand, completely normal?  I would suggest not.

The original article refers to two customers directly.  One was over £1000 in debt, had been warned by letter and than later told by text that the meter was changing, and had been in communication with the supplier for ten months.

The second customer was alleged to be in £1600 of debt (which they dispute but only by assertion that it "must be wrong").  The way the article is worded, suggests that this debt was alleged and disputed some time before the meter was switched over.  The customer says "no notice" but again, this is just an assertion and there is no indication from the supplier whether an attempt was made or otherwise.

Suppliers' communication is often poor, and mistakes can be (and have been) made.  I'm yet to see any substantial evidence that this is actually a problem that needs addressing though, beyond the usual vague assertions of "evil suppliers and complicit regulator".

Petriix

I'm not assuming anything. I'm just pointing out the possibility that a supplier could do this based on their own incompetence, as evidenced by the many threads detailing such incompetence on this very forum. There's no need for anything more sinister. Previously it wasn't possible for a supplier to make this kind of mistake without a court order, now they are free to do so at their leisure.

I am well aware that many of the issues that people have with their suppliers are due to their own ignorance more than anything. But the bigger problem is that it is very difficult to contact a supplier and have a rational conversation with someone who a) understands the issue; and b) has the ability to resolve it.

If this doesn't set your alarm bells ringing then you clearly have more faith in the industry than I do!

deano2099

[Deleted User] said:

Instantly take out all your credit - the next day January's energy bill arrives - then what?

You pay it?
It's like saying "You spend all the money in your bank account on crisps, next day your mobile bill arrives, then what?"

People are perfectly capable of managing their own money, otherwise there would be far more missed bills and payments. It's useful to have what's essentially a second "account" for energy, as usage is variable, and you can top it up as necessary. People would be perfectly capable of managing that if it was expressed to them in that way: this is your money, you are responsible for keeping enough money in here to pay your bills, you can take it out whenever you want, but there's an admin charge if you go "overdrawn".

That works, because that's how bank accounts work. People understand it.

And this is how energy companies want people to understand it. But they don't. Because they instead treat the credit like their own money. And don't have the reserves to actually refund all their customers if they all asked for a refund at the same time. And so this causes confusion. Because if the customer can't automatically get their own money back, they don't see it as their money. And from there it's a small, incorrect logical leap to "well when I pay extra I can't get it back so when I pay too little they shouldn't ask for more" and people treating the direct debit like an all-you-can-eat energy buffet.

It'd be really, really easy to get people to start thinking of an energy account like a bank account. If the suppliers are willing to start treating them that way.

[Deleted User]

It has always been possible to change someone's meter without a court order - it's only the access to the property that required one. Anyone whose meter box was accessible from the street or was in the landlord's area of a communal property could have been changed to prepayment at any time.  There didn't appear to be any campaign or consumer outrage about that.

Relying on the relative number of threads on a self-selecting internet forum is unlikely to give a good guide as to the true picture.  You won't get many threads saying "I had an issue, called my supplier and they solved it" or "everything is working just fine".

Can their be some situations that aren't working well?  Of course there will be.  I'd probably even say that the evidence indicates that the frequency of issues is increasing.  It's just not clear at the moment whether this is anything other than a niche issue which can be dealt with under the existing system, or whether there is actually a wider issue that needs substantial overhaul.

QrizB

[Deleted User] said:

The second customer was alleged to be in £1600 of debt (which they dispute but only by assertion that it "must be wrong").

Considering that the customer in question has a working smart meter (otherwise it wouldn't have been possible to switch it to prepayment remotely), their claim that the debt is disputed really needs to be taken with a pinch of salt.

EssexHebridean

If anyone is in doubt about the "It must be wrong" assertion and thinking that perhaps the bill IS wrong - have a bit of a browse back on these boards at all the threads with titles in that vein - almost invariably it transpires that in fact the bill ISN'T wrong, but that the OP of those threads is simply a far higher user than they thought they were, or that they haven't taken account the price rises over the last year because they have been on a fix, or any of a myriad of other reasons why energy now costs far more than a lot of people think it does! Just occasionally we get one where the units being used for billing on gas are wrong, or where it turns out a SM isn't sending readings and the supplier is over estimating (although that in itself should be picked up by the customer of course!) or something along those lines.