Switching Energy Suppliers - Sharp Practice?

Lewis100c

After using MSE's Energy Comparison tool to help me switch providers I thought I was in for a saving.

I opted for Home Energy after being with So Energy for many years.

In the flurry of screens in the signing up process, and, perhaps, I should have read things more thoroughly, but the key policy phrase was buried in the text within the side panel showing the Direct Debit Guarantee.

It appears that I am now paying in advance for my gas and electric.

Upon reading the panel, their stated policy is that they want full payment 10 days after sign up (sic). In my case this was just 3 days after actually being supplied by them. This makes an additional energy payment, So Energy having already billed me for the month, thus wiping out any savings I might have made.  I wonder if MSE could highlight this practice, is it common?

Luckily there is no early exit fee and so I am now considering my position but do not fancy yet another full month's payment in advance.

To add to my chagrin So Energy have a considerable sum of credit they now owe me. Upon speaking to them payment will only come in some 2-6 weeks time, depending on when they deem to send me the final bill. 

Again - Sharp practice or is it just me? Something again for MSE to perhaps highlight?

Swapping energy providers, in my case, far from saving me money, has simply lined the pockets of the providers at my expense. Why can't people simply be charged for the goods and services they use and not be forced to plump up cashflow by paying in advance.

BarelySentientAI

No, payment in advance is not "sharp practice".  It is the most common method of paying for energy (if you treat it the same as fixed monthly direct debit, which uses effectively the same principle), clearly laid out in the terms and conditions of the deals that you have signed.

Some suppliers offer monthly variable direct debit (which I guess is what you are actually asking for), some don't.  You use smaller suppliers because they are cheaper, you find they have more restrictive T&Cs.

You can also choose to pay on receipt of bill with most suppliers, but it is more expensive.

And it has not "wiped out any savings you might have made", because you are only charged for what you use - so any actual savings (that wasn't just you being confused by estimated monthly payments) will be realised.  Cash flow is not cost.  There has been no pocket lining.

Netexporter

It's pretty normal practice to pay upfront on direct debit, has been for years. It is the reason why paying by DD is the cheapest option, along with pre-pay meters. You are paying for getting credit in the old three months in arrears model, which is the most expensive.

You can opt to pay the full amount by DD, monthly in arrears, with some suppliers.

MP1995

Next switch, enter a meter reading for your previous supplier and get a refund of your excess money first. Then proceed with your switch.

FreeBear

Lewis100c said: To add to my chagrin So Energy have a considerable sum of credit they now owe me. Upon speaking to them payment will only come in some 2-6 weeks time, depending on when they deem to send me the final bill.

So Energy have strict time limits on issuing a final invoice and refunding any credit. Failure to meet either result in statutory compensation being paid (£30 each). If they then fail to pay the statutory compensation within the specified time frame (14 days ?), another statutory compensation payment becomes due. In all, you could be in line to get another £120 for their tardyness.

https://www.ofgem.gov.uk/get-compensation-problems-switching-energy-suppliers