New to Npower

whoimi

Hi all

wondering if someone can give me a bit of advice here..i recently got married and now living seperately at my own place with my wife..was living with parents but moved out now so we both quite young

i got a letter the other day from Npower saying that thery are the supplier blah blah blah..........and that i shud ring to confirm my details

so i did that today

now they are charging me £60 per month for both gas and electricity in a 3 bedroom house

ive set up direct debit and they say that i can save 80 pounds per year etc

now thing is since im new to all this

a) is 60 per month reasonable?
b) How exactly does it work? they said somethinglike u get charged 30 apiece (Gas and electricity) and if u dnt use that much it carries over........what does that mean?

thanks

c0113tt3

£60 per month sounds a little low, and you will likely end up with a large big bill eventually, most household fuel bills are around £1000 per year for both.

Secondly, npower currently have several scams at the moment such as over charging, being investigated by energy watch and ofgem. They are also the worst for customer service / billing problems too. I would certainly switch to another company.

whoimi

hmm thanks for that.....well to be honest doubt we will be using much electiricty dont have a TV or anything lol what ill do ill hang around for a couple of months and see what happens and report back!

c0113tt3

With thanks to DirectDebacle:
in the npower gas sculpting thread:
http://forums.moneysavingexpert.com/....html?t=822299

npower in the news http://business.timesonline.co.uk/to...cle3994954.ece

and here http://business.timesonline.co.uk/to...cle3992766.ece

and here http://www.timesonline.co.uk/tol/com...cle3994897.ece


THE TIMES NEWSPAPER 24/05/08

Regulator investigates £50m gas overcharging claims against npower
Mark Atherton

Millions of consumers may have been overcharged by at least £25 on their gas bills by one of the biggest energy companies, The Times has learnt.

Ofgem, the energy regulator, is investigating claims that up to 2.2 million customers of npower may have been billed too much for gas usage. Energywatch, the energy watchdog, believes that excess charges could total more than £50 million.

The problem has come to light after readers of The Times uncovered apparent flaws in npower’s billing systems and alerted the watchdog, which referred the matter to Ofgem.

Energywatch is urging all npower’s gas customers to check their bills for the past 12 months. A spokesman said: “We think up to 2.2 million npower customers could have suffered from the same problem that Times readers have identified. If we are proved correct we want to know what the company will be doing to compensate those who have lost out.”
Related Links


The problem centres on how many units of gas npower is entitled to charge customers each year at the higher of its two rates. In literature and on its website, the company states that the higher charge applies to a maximum of 4,572 units per annum — after which customers pay at a lower rate.

However, the company claims this figure refers to a “tariff year”, not a calendar year. In 2007, npower’s “tariff year” lasted only seven months — from April to November, when the tariff was altered — meaning that many customers ended up paying significantly more than 4,572 units at the higher rate over the course of the year.

Consumers are already facing sharply higher energy costs. Since January 2006 the average annual household energy bill has risen from £735 to £1,048, according to uSwitch, the price-comparison website. The increase for npower customers has been even steeper, from £671 to £1,056.

Since the start of 2006 npower’s gas customers have suffered no fewer than four price increases. In January 2006 npower put up prices by 13.7 per cent, and followed this up with further rises of 15 per cent in March and 17.2 per cent in October.

There was a 16 per cent cut in 2007 but this was more than wiped out by a further 17.2 per cent rise in January 2008. A typical npower gas customer now faces an annual bill of £631, compared with £466 at the start of 2006.

Domestic energy bills could rise by a further 25 per cent this year as the wholesale cost of gas surges higher.

MPs on the Business and Enterprise Select Committee have been investigating competition in the UK power market. On Tuesday, in evidence to the committee, Allan Asher, the chief executive of Energywatch, accused the big six energy suppliers of being bloated, inefficient, and leaving consumers to “get it in the neck”.

The allegation of overcharging also follows accusations against npower of mis-selling. This month, it dismissed six employees after revelations that its door-to-door sales staff were lying to customers to gain new business.

The customers who approached The Times to complain of being overcharged say that a year should mean a year. David White, 67, of Maidenhead, Berkshire, said: “My contract, which I took out in January 2007, stated I would be charged 4,572 units a year at the higher price and the rest at the lower rate. But after 11 months I had been charged 5,939 units at the higher rate, meaning that I was overcharged by £41.

Andrew Beck, of Teignmouth, Devon, said that he had decided to take legal action against the company. Mr Beck, 55, said: “I have filed papers with my local court alleging breach of contract by npower. In the 12 months to April 2008 I was charged in excess of 6,500 units at the higher rate, resulting in an estimated overcharge of £120. I suspect that many of npower’s customers will have suffered from the same problem. If each annual bill was just £50 too high and npower had two million gas customers, that would be a total overcharge of £100 million.”

An npower spokesman said: “What we promise is that we won’t charge gas customers more than 4,572 units at the higher rate in a tariff year, which is not always the same as a calendar year. In our short tariff year of seven months from April to November 2007 we didn’t charge anyone more than 4,572 units at the higher price, but over a full 12 months, we did.

“This was a one-off situation — between April and November 2007 we changed our normal billing method as we brought different sets of customers on to one system. We suspended our seasonal weighting, which charges more units at the higher rate in the winter and fewer in the summer. This resulted in a number of people being charged more than 4,572 units at the higher rate in the year April 2007 to April 2008 but they should take into account that we reduced our gas prices by 20 per cent in April 2007.”

An Ofgem spokesman said: “We are asking npower questions relating to suspected inaccurate billing.” If Ofgem found that npower had breached the terms of its supply licence it could impose a fine of up to 10 per cent of the relevant subsidiary’s turnover and require it to amend its behaviour

SwanJon

DH - you got a vested interest in that website?
You mention it in all your poasts so far.

Premier_2

whoimi wrote: »

...b) How exactly does it work? they said somethinglike u get charged 30 apiece (Gas and electricity) and if u dnt use that much it carries over........what does that mean?

Think of it like this.

Every month npower will take a total of £60 off you. They'll put £30 in an account for gas and £30 in an account for electricity (a bit like you opening 2 savings accounts and putting the money in them youself, but with npower they won't pay you any interest on the money banked and you won't be able to access the money)

Every 3 months they'll take gas & electricity meter readings (or estimate them) and calculate your invoices.

Say your gas consumption calculation only comes to £70 for the 3 months, they will use the £90 already collected and carry over the £20 difference to the next 3 months.

Say your electricity consumption calculation comes to £150, they will use the £90 already collected and carry over the £60 shortfall to the next 3 months.

If this pattern continues unchanged, you will ultimately have overpaid for gas £160 after 2 years (i.e. 8 x £20)

Similarly, you will have underpaid electricity by £480 (i.e 8 x £60).

What npower does then is where the problems start.
They could repay you the £160 overspent on gas (but probably wont)
They could demand you pay £480 owed on electricity (and possibly will)
They could offer to use the £160 overspent on gas to reduce the £480 underpaid on electricity (but probably wont)
They could decide unilaterally to increase the Direct Debit from £60 per month (of which only £30 is going towards electricity) to say £120 per month
which would be made up as follows:
£30 for gas as now (even though that slightly is more than you actually use)
£50 for electricity used per month (based on previous usage)
£40 for outstanding electricity debt recoverable over 12 months.

Of course you could elect not to pay npower anything monthly, put the money into a savings account and earn interest for yourself, have complete control on where the money is going (i.e. use any overcharge for gas to subsidise any undercharge for electricity) and pay the bill recording actual usage every 3 months.

So why don't you do this? A good question!
(a) you'll have to find the shortfall of £40 every 3 months representing the difference between the money banked and the billed amount (although you might decide to bank a little extra as soon as you realise the amount banked in insufficient to cover the bill received)
(b) you might not be disciplined enough to bank the amount to pay for the gas & electricity, or even raid the bank to support some other 'emergency' (like a good night out)
(c) you'll lose any incentive npower pay, in this case £20 per quarter (£80 per year) in agreeing to buy both gas & electricity from them and helping them with their own cash flow by paying them every month.


Note, this is not unique to npower but the essentially the way all the companies work (although prices and incentives vary)

whoimi

hmmm thanks for that lol seems really complicated !

ok im gonna hang in for a few month and see how it pans out!

Premier wrote: »

Think of it like this.

Every month npower will take a total of £60 off you. They'll put £30 in an account for gas and £30 in an account for electricity (a bit like you opening 2 savings accounts and putting the money in them youself, but with npower they won't pay you any interest on the money banked and you won't be able to access the money)

Every 3 months they'll take gas & electricity meter readings (or estimate them) and calculate your invoices.

Say your gas consumption calculation only comes to £70 for the 3 months, they will use the £90 already collected and carry over the £20 difference to the next 3 months.

Say your electricity consumption calculation comes to £150, they will use the £90 already collected and carry over the £60 shortfall to the next 3 months.

If this pattern continues unchanged, you will ultimately have overpaid for gas £160 after 2 years (i.e. 8 x £20)

Similarly, you will have underpaid electricity by £480 (i.e 8 x £60).

What npower does then is where the problems start.
They could repay you the £160 overspent on gas (but probably wont)
They could demand you pay £480 owed on electricity (and possibly will)
They could offer to use the £160 overspent on gas to reduce the £480 underpaid on electricity (but probably wont)
They could decide unilaterally to increase the Direct Debit from £60 per month (of which only £30 is going towards electricity) to say £120 per month
which would be made up as follows:
£30 for gas as now (even though that slightly is more than you actually use)
£50 for electricity used per month (based on previous usage)
£40 for outstanding electricity debt recoverable over 12 months.

Of course you could elect not to pay npower anything monthly, put the money into a savings account and earn interest for yourself, have complete control on where the money is going (i.e. use any overcharge for gas to subsidise any undercharge for electricity) and pay the bill recording actual usage every 3 months.

So why don't you do this? A good question!
(a) you'll have to find the shortfall of £40 every 3 months representing the difference between the money banked and the billed amount (although you might decide to bank a little extra as soon as you realise the amount banked in insufficient to cover the bill received)
(b) you might not be disciplined enough to bank the amount to pay for the gas & electricity, or even raid the bank to support some other 'emergency' (like a good night out)
(c) you'll lose any incentive npower pay, in this case £20 per quarter (£80 per year) in agreeing to buy both gas & electricity from them and helping them with their own cash flow by paying them every month.


Note, this is not unique to npower but the essentially the way all the companies work (although prices and incentives vary)

barginunter

I had a bad experience with Npower - i think they're a dreadful company.