Npower Business Rip-off

caf4926

NPOWER BUSINESS RIP-OFFA serious word of warning. We signed up with npower gas and elec - 11 months ago, fixed rates for 12 months. Just received a price for the next 12 months - Both are doubled.

BUT. We are locked in for another 12 months because the contract rolls over automatically. You have to give 90 days notice before the contract ends! - Interesting that they don't tell you of the changes before the 90 day period is up.

Oh. The 90 day part of the contract. It's in amongst 3 pages of minuscule print.

Anyone else had this. Or even better - know a way out?

Terrylw1

Hi,

This is very common with utilities since Ofgem don't afford you the same rights as a domestic customer.

The reason generally being, they assume as a business you will read every element of a contract before signing unlike many domestics or have a solicitor who can do so.

Notice periods are common and if not you get locked back in and go onto "out of contract" rates.

So, they haven't changed the terms of the price freeze, they have put you on a deemed contract which the Utilities Act states can be charged at a higher rate to an agreed contract.

The new rates you have received are due to this because you have failed to renew under a new contract on the bext rates or agreed not to stay and charged Supplier.

There are lots of press articles about this going on but it's legal.

janeymates

Hi Caf4926,
We are in a similar position with Npower,
Problem being that we had a 5 year contract and the person who took it out is no longer working here, therefore no-one knew about the 90 day notice thing (though I suspect had they still been here it would still have been overlooked - who can remember 5 years back?!)

Just wondered if you had any further info on this since your original post.

thanks
J

assos

Looks like we've been done as well.

Was paying 2.29 pkw for gas but got a letter stating an increase to 3.54 pkw.

That's a whopping 36% increase!!!!!!!

I wasn't aware of the automatic renewal of contract until I rang British Gas who asked me to double check the T&T as he was sure i was going to be locked into a new contract.

I've not signed and returned the form which they wanted me to and I might have to have a word with my solicitor to see where do I stand on this as I did not sign for a new contract.

BTW. British gas business rate without standing charge came in at 2.73 pkw.

Terrylw1

assos wrote: »

Looks like we've been done as well.

Was paying 2.29 pkw for gas but got a letter stating an increase to 3.54 pkw.

That's a whopping 36% increase!!!!!!!

I wasn't aware of the automatic renewal of contract until I rang British Gas who asked me to double check the T&T as he was sure i was going to be locked into a new contract.

I've not signed and returned the form which they wanted me to and I might have to have a word with my solicitor to see where do I stand on this as I did not sign for a new contract.

BTW. British gas business rate without standing charge came in at 2.73 pkw.

Sadly Ofgem don't afford business customers the same protection as domestics. T&C's in these contracts will clarify it for you.

However, be aware that 'Deemed contract' are perfectly legal and are covered in the Utilities Act.

They have been around for many years and small businesses are getting stung like this. There have been articles in the national press about it.

You could try and complain hard enough to see if they will agree to mutually backout and let you switch, but thats all becaue if it's in the T&C's they are adhered to the contract so have breached nothing.

assos

Terrylw1 wrote: »

Sadly Ofgem don't afford business customers the same protection as domestics. T&C's in these contracts will clarify it for you.

However, be aware that 'Deemed contract' are perfectly legal and are covered in the Utilities Act.

They have been around for many years and small businesses are getting stung like this. There have been articles in the national press about it.

You could try and complain hard enough to see if they will agree to mutually backout and let you switch, but thats all becaue if it's in the T&C's they are adhered to the contract so have breached nothing.

I rang up Npower on friday and as in above case was told of the 90 day cancellation period as written in T&C's. However after stating how unhappy as a long term customer and potential future customer they will call me back Monday to see if a lower rate can be offered but on a 24/36 month contract.

British gas have offered me 2.65 pkw on a 12 moths contract so I'll have to wait and see what their rate will be. And if they are still going to be over 3pkw then I'll have to bite the bullet, send them my cancellation notice for next year on gas and electric and look for a new supplier november/december 08.

Lesson learnt. Make sure you read the small print before you commit to anything!!!

Chef1980uk

Hi all, just came here to ask if my monthly increase matches the % increase announced by Npower. Saw this thread so though best to stick it in here and have one Npower thread.

Balance on last bill £72.46

credit

Payment received with thanks on 04/12/07 £72.00

credit

Payment received with thanks on 02/01/08 £72.00

credit

Account balance before charges
Account balance before charges £216.46 credit
Total electricity charges this period £244.40

debit

---

How we worked out your new payment
Estimated electricity units 1094 at 20.010p £218.91
Estimated electricity units 9211 at 9.750p £898.07
Estimated electricity units 11663 at 4.030p £470.02
VAT at 5.00% on £1587.00 £79.35
Total estimated charges over the next 18 months £1666.35
Account balance brought forward £27.94 debit
Less payment due on 01/02/2008 £72.00

credit

Total £1622.29

debit
Divide by 17 £95.42

Tariff - Economy 7 Sign Online 6 / Monthly Direct Debit

Signed up last March after reading the article here about switching if i hadn't done so before. We were with Eon and was paying £96 per month. Just seems a bit fishy the new plan works out at the same yet we were down to £72 when we switched.

Do you think the new increase for us is too much?

dizzie

RE NPower Business Energy Contract

Rolling contracts seem to be a pretty common thing in the business world, and if you don't give e.g. three months notice prior to the anniversary date of your contract, you are tied in for another year (no matter what they decide to charge you). I was with NPower for my business and fell foul of this. In my case their service was shocking. Several bills added a surcharge for "not paying by direct debit"...even though I was paying them by direct debit. Chasing refunds was a nightmare - they just didn't reply and it took up a lot of my time with repeat attempts. Their customer services assistant gave me incorrect information ( which cause me financial loss). They acknowledged this but would only offer a verbal apology (no recompense), citing "staff training problems"!

As for this rolling contract thing, as far as I can see, this is quite common with the Business Utility Providers. Best thing you can do when you set up an annual contract is sign up to it, get started, and then cancel it so that you are free to move on the anniversary date.

But if you cancel:

Do it in writing. Send it by recorded delivery. Go onto Royal Mail's website and download the proof of receipt a week or two later...and keep your evidence. Even though I eventually did this, NPower still tried to deny having received my termination instructions, so I had to provide this evidence as proof.

NB Watch out for other providers doing this too, e.g Trade Waste Companies

Terrylw1

dizzie wrote: »

RE NPower Business Energy Contract

Rolling contracts seem to be a pretty common thing in the business world, and if you don't give e.g. three months notice prior to the anniversary date of your contract, you are tied in for another year (no matter what they decide to charge you). I was with NPower for my business and fell foul of this. In my case their service was shocking. Several bills added a surcharge for "not paying by direct debit"...even though I was paying them by direct debit. Chasing refunds was a nightmare - they just didn't reply and it took up a lot of my time with repeat attempts. Their customer services assistant gave me incorrect information ( which cause me financial loss). They acknowledged this but would only offer a verbal apology (no recompense), citing "staff training problems"!

As for this rolling contract thing, as far as I can see, this is quite common with the Business Utility Providers. Best thing you can do when you set up an annual contract is sign up to it, get started, and then cancel it so that you are free to move on the anniversary date.

But if you cancel:

Do it in writing. Send it by recorded delivery. Go onto Royal Mail's website and download the proof of receipt a week or two later...and keep your evidence. Even though I eventually did this, NPower still tried to deny having received my termination instructions, so I had to provide this evidence as proof.

NB Watch out for other providers doing this too, e.g Trade Waste Companies

I wonder if this will change if enough of you guys complain to Ofgem? Maybe the small businesses could get together since there are websites for SME's in this country and push for a change.

I would be nice if these companies sent you reminders about the lock in but conveniently they don't because they know you will be busy running your business and will fall foul of it. Larger companies don't as they have solicitors dedicated to this side of the business or specific contracts managers in place.

The Guardian had an online artcle about this happening in the SME market.

The Utilities Act allows it but maybe the standard of communication could be changed to make it more consumer friendly?

If you kick off hard enough and at the right people then you may get some help, as Assos is rightfully doing.

billsavings

The people mentioned in this sticky
http://forums.moneysavingexpert.com/showthread.html?t=49333
will help you get out of Business Contracts at earliest legal opportunity, get you decent business energy rates,and remind you when to cancel your rolling contracts.

whatatwit

My business is with N-Power and I did get a letter informing me of the increased prices...but this letter was more than 90 days before the end of the existing contract.

Needless to say, I have now made sure that my renewal dates are in my diary along with a reminder about 4 months prior.