Tomato Energy (Electric Only Supplier) - Too Good To Be True ?

masonic

Scarum said:

How does Tomato source the energy?  Sorry if that has already been discussed but this is a long thread and I'm trying to catch up.

Does this answer your question? https://www.tomato.energy/fuel-mix

Newbie_John

Bendo said:

If they sorted their SMETS1 issues I'd consider lifestyle. With the price of gas it would work out cheaper to heat my thermal store via electric overnight and it would provide a good chunk of the heating with only a small top up with gas required later on.

But I still foresee that SMETS1 issue putting them out of business eventually. It can't be doing them much good for cash flow, given their prices look like they barely cover their costs, the additional  burden on customer service and inevitable ombudsman fees will probably crippled them.

They no longer accept SMETS1 and getting a lot of new joiners who must bring profits as they aim at 1mln customers.
With dumb meters people don't get their "real" bills for months until readings are done - they're just charged estimated amount. So still don't see an issue if someone didn't get their bill from September - I haven't received my final bill from Octopus from September either - will they collapse as they already paid me £30 compensation? 
In the last 1-2 months they've fixed a lot of issues, just matter of time for the rest.

Regarding the costs, it's not as straight forward - checking their fuel mix it looks like 99.8% is not green - and all these power plants run 24h a day and the night electricity must be used.. 

And the size of company - Octopus has 10000+ employees - TE like 10-20, so they can operate on smaller profits. 

Bendo

masonic said:

Bendo said:

If they sorted their SMETS1 issues I'd consider lifestyle. With the price of gas it would work out cheaper to heat my thermal store via electric overnight and it would provide a good chunk of the heating with only a small top up with gas required later on.

But I still foresee that SMETS1 issue putting them out of business eventually. It can't be doing them much good for cash flow, given their prices look like they barely cover their costs, the additional  burden on customer service and inevitable ombudsman fees will probably crippled them.

What makes you think SMETS1 would put them out of business? Because the compensation they'll need to pay out to SMETS1 customers that joined them originally? Because they're cutting off a large number of potential customers?

I'm not fully up to speed on the situation with SMETS1, but I remember years of controversy around them being continuing to be installed after SMETS2 meters were available.

The issue with SMETS1, for them at least, is the number of customers they have signed up on smart tarrifs and can't bill because for some strange reason, they can't read them. Adopted SMETS1 meters should be no more difficult for them to access than SMETS2.

They have promised big discounts to those affected when they do finally get round to billing them (although I can't think of any reason they haven't fixed the issue yet other than not being able to pay someone enough to fix their integration). 

Those issues will be costing them (possibly quite significantly depending on their agreements with who they are buying the electricity from given they cant pay for it as they have no idea how much their customers are using and there may well be penalties for that.

Their business model is basically sell at near cost, that's fine but when problems crop up it doesn't really give any margin for the additional support costs, potential ombudsman costs etc. The promises of discounts for late bills is no doubt to try and ward off ombudsman fees. 

I just don't see where the funds are coming from to cover their costs and the upcoming ones. If anything it looks more of a risk than the likes of Aveo etc were back on the day,.

Bendo

Badboi said:

Has anyone looked at tomatopia? 5 years and you own the solar panels looks very tempting…

Far too little to go off on their site. There was some talk on the faceboom group of you being locked into export with them for longer than 5 years.

masonic

Bendo said:

Their business model is basically sell at near cost, that's fine but when problems crop up it doesn't really give any margin for the additional support costs, potential ombudsman costs etc. The promises of discounts for late bills is no doubt to try and ward off ombudsman fees. 

I just don't see where the funds are coming from to cover their costs and the upcoming ones. If anything it looks more of a risk than the likes of Aveo etc were back on the day,.

Almost certainly they'll be operating at a loss, and will have to do so for a considerable amount of time if they have any hope of building a customer base. Octopus Energy was loss-making for its first 8 years, and was quite lucky to be in the position to take advantage of the energy crisis and mop up a huge number of customers as SoLR. Of course we know they were backed by considerable capital and probably could have continued for longer if necessary. I was only too happy to join them for some of that ride, picking up £500 of free energy and a couple of years on the ridiculously cheap Go Faster tariff for which the peak rate was way below SVT at the time.

There's always a chance that those behind Tomato are completely unaware of what it takes to be successful in this market, but they do seem to be imitating Octopus, so hopefully they've at least perused their financials.

The main danger will be another energy crisis similar to the one that took out virtually all smaller suppliers.

Bendo

Absolutely,  the problem is, energy supply isn't really renowned for customer loyalty. People will go where it is cheap at the end of the day so building up a customer base is needed, doing so at a price that doesn't make money probably doesn't help.

This is where Octopus have been smart, with the likes of the mini, its a pretty unique offering exposing real time data and those that find value in that may be tempted to stay put rather than chase the absolute lowest unit costs.

Doc_N

The title of this thread contains the magic consumer warning words ‘too good to be true’ - admittedly, with a question mark.

Having now checked out the Companies House record, I’ve ditched my potential switching plans. Too many of what I’d see as red flags.

masonic

Bendo said:

Absolutely,  the problem is, energy supply isn't really renowned for customer loyalty. People will go where it is cheap at the end of the day so building up a customer base is needed, doing so at a price that doesn't make money probably doesn't help.

This is where Octopus have been smart, with the likes of the mini, its a pretty unique offering exposing real time data and those that find value in that may be tempted to stay put rather than chase the absolute lowest unit costs.

True, I think the thing I'll mourn most is the API. But like Octopus, domestic customers are a necessary commodity for Tomato's larger plans. I can't say I've looked into their EaaS offering in too much detail, or into their decentralisation vision, but I guess that is what is pulling in the investment capital. We shall see how long the ride lasts.

Chrysalis

Newbie_John said:

Chrysalis said:

Lifestyle tariff deffo looks interesting, at first glass assuming they can do variable DD, then risk should be low, but the posts indicating TOU errors is concerning.

I might email Octopus and tell them of my intentions, give Octopus the chance to give me an exception to join Cosy to keep me as an electric customer.

They do variable DD, 2 paid already.
TOU errors are gone for most, some ppl on SMETS1 who joined in early days still waiting for their bills but they get 15% for 3 months delay, 30% for 6 months delay.. discount. Anyway, no new SMETS1 allowed.

My IHD works fine showing live data. MyWatts gets updates every 3h at ...9am, 12, 3pm.. so it's almost live data.

Anyway, till mid November it was quite worrying for me as nothing worked - all sorted now and it's quite boring especially after being on Agile for a while - I don't care anymore - everything is scheduled to run 0-6am, don't need to check rates, bills cover full month 1-31 unlike Octopus was in my case 26-25th.. 

My only worry now is - will they drop the 5p tarrif in a year time?

What I meant by live is seeing the live watts usage, not the speed the graphs are generated, but hopefully the IHD still works for that, better than nothing.

Although it is definitely good the graphs update much quicker, on Octopus sometimes I have to wait nearly 2 days for graphs, most mornings they completely inaccessible with a message saying they working on it apart from current day which is done via the mini.

If they drop it they drop it, they might not even be here in a years time, just ride the wave whilst its here.

mr_accountant

Doc_N said:

The title of this thread contains the magic consumer warning words ‘too good to be true’ - admittedly, with a question mark.

Having now checked out the Companies House record, I’ve ditched my potential switching plans. Too many of what I’d see as red flags.

The three 'directors' have involvement in 42 companies between them, they must be very busy, that will explain why their accounts are overdue!

I'll pass on this one and pay a little more with octopus