British Gas Price Freeze

Cardew

jem16 wrote:

I would have thought it's a bit early to reconsider yet

Of course it's only my opinion and I may be totally wrong but at the moment I'm saving a lot of money.

I believe the 2010 option is now closed isnt it?

You may well be right but the way things are looking, if the press are to be believed, the gamble on BG is looking a better bet.

I wish more posts on this forum were balanced and it is a pity that people can post on here(not you I would add) with absolute certainty about whether the tariff is a good risk or not. The phrase 'Proof by repeated assertion' comes to mind.

sleepy

jem16 wrote:

I can't see BG or any company for that matter being so good to us - I feel there must be something in it for them too.

What's in it for them? It has been attracting a lot of customers to switch to them. I work for british gas and we've had quite a few people switch their supplies back to us so they can price freeze them. The customers like the security of knowing their prices won't change until 2010 and the company likes the fact that the customers are likely to stay with them until 2010.

jem16

Cardew wrote:

I believe the 2010 option is now closed isnt it?

I didn't know it had closed but certainly looking at their website today I can't see it mentioned.

You may well be right but the way things are looking, if the press are to be believed, the gamble on BG is looking a better bet.

It's not so long ago that the energy experts were saying the opposite but that's the problem in making an educated decision.

jem16

sleepy wrote:

What's in it for them? It has been attracting a lot of customers to switch to them.

You've just answered your own question.

I work for british gas and we've had quite a few people switch their supplies back to us so they can price freeze them. The customers like the security of knowing their prices won't change until 2010 and the company likes the fact that the customers are likely to stay with them until 2010.

I agree it's seen as security but at the moment I would be paying a 30% premium to have it compared with what I'm paying now. I was also not keen on the penalties that they were imposing if you did leave before 2010 so if prices did fall you were stuck.

Cardew

jem16 wrote:

You've just answered your own question.




I agree it's seen as security but at the moment I would be paying a 30% premium to have it compared with what I'm paying now. I was also not keen on the penalties that they were imposing if you did leave before 2010 so if prices did fall you were stuck.

If you are using enough Gas and Electricity to be talking about currently saving hundreds of pounds, then the BG penalty clauses for leaving are hardly punitive.

You are absolutely right about the difficulty in making an educated decision and by 2010 we all will know whether taking up the BG offer was correct or not. However whichever way we went it was from merely following a hunch, rather than the application of wisdom.

I went for the BG deal and am feeling a little more confident that it was the right guess, but readily concede it is far too soon to count my chickens.

The point in resurrecting this thread was to point out that those posting with such certainty(and negativity) earlier in this, and other threads on the subject, might just have to eat their words.

P.S.
I think you will find that Sleepy was answering your point, not ‘his own’ question.

jem16

Cardew wrote:

P.S.
I think you will find that Sleepy was answering your point, not ‘his own’ question.

I realise that. However in the same way it answered the point that I made about British Gas not making this offer out of the goodness of their hearts. They stand to gain even if it's only by attracting new customers now. Time will tell if they gain more by having customers locked into high tariffs.

As for penalties I just feel that they are wrong no matter how large or small. After all you are paying a premium to have this price freeze in the first place.

squeaky

The thing that worries me, since I made the change some time ago when it was first offered, (silly me), is that now I have my letter of confirmation - the tarrifs might be fixed, good or bad, but in fact it works on three different price bands.

Tier one x many units a n pence

Tier two y many units at m pence

Tier three z many units at o pence


So in fact they can freeze the price per unit for ever (almost) but expand the lower tier bandwidth any time they like as often as they like - so my bill can still go up even if my cost per unit (in any given tier) stays the same.

I think I've just been had.

Cardew

squeaky wrote:

The thing that worries me, since I made the change some time ago when it was first offered, (silly me), is that now I have my letter of confirmation - the tarrifs might be fixed, good or bad, but in fact it works on three different price bands.

Tier one x many units a n pence

Tier two y many units at m pence

Tier three z many units at o pence


So in fact they can freeze the price per unit for ever (almost) but expand the lower tier bandwidth any time they like as often as they like - so my bill can still go up even if my cost per unit (in any given tier) stays the same.

I think I've just been had.

Interesting thought and certainly had me thinking.

However I have been looking at the offer and the acceptance letter. I am not a lawyer but my reading of it means they cannot do what you suggest.
BG specifically say they will "freeze your new energy prices" and the only caveat they give is if the VAT rate changes. Note "prices" and anything that increased your prices would not be a freeze.

Also it specifically states in the documentation("what you will pay") exactly what the tier levels are "Tier 1 prices will apply to the first 1,1143 kWh etc" I can see nothing that indicates they could increase the tier to, say, 2000 kWh.

Most of the companies have had fixed/capped tariffs over the years and I am not aware of any that have tried that trick. There would be an outcry if they did and the regulator would surely never let them get away with such a practice.

jem16

squeaky wrote:

The thing that worries me, since I made the change some time ago when it was first offered, (silly me), is that now I have my letter of confirmation - the tarrifs might be fixed, good or bad, but in fact it works on three different price bands.

Tier one x many units a n pence

Tier two y many units at m pence

Tier three z many units at o pence


So in fact they can freeze the price per unit for ever (almost) but expand the lower tier bandwidth any time they like as often as they like - so my bill can still go up even if my cost per unit (in any given tier) stays the same.

I think I've just been had.

I can see where you're coming from although as Cardew says it would still be construed as a "price rise" if you ended up paying more.

However it's an idea and only time will tell. I feel sure though that BG know more than they're telling us about future prices for gas. I can't see them "giving the stuff away" at low prices(in future if prices do rise that is) just to be nice to customers - they are after all a business and businesses do want to make money.

squeaky

Hmm... right... call me a cynic, but I'll be keeping a close eye on this one

Thanks for the input.