notbritishgas wrote: »
Is this method of calculating the over charging too simple?
In 2007 Npower suspended sculpting between I believe April and November? and introduced the flat 4572/365 method.
Why not work out on a daily basis for that period the amount of high units charged on the flat method and then work out how many should have been charged under sculpting. The difference is the overcharge.
DirectDebacle wrote: »
Using a customers start date as opposed to 1st April will be a much cheaper option for them. As you point out it is not clear how they will do this for customers whose start date falls between May and Nov. These accounts will require two calculations and we will have to wait and see if this is being done.
Terrylw1 wrote: »
I don't agree that the time limit is valid either. Npower & Ofgem spent a long time doing wishy washy things and trying not to refund anything. In that time all thhey did was try to delay past the time limit.
DirectDebacle wrote: »
Thank you. I am pleased you have received a payment. However I am not convinced they are being calculated fairly.
If we look at their explanation of how these payments will be calculated it is not clear to me how they are doing it.
The first sentence seems quite straightforward. We know that the period when the maximum possible number of higher priced units could have been charged is the twelve month period of 1st March, 2007 - 29th Feb, 2008. It was possible for a customer to be charged 6820kWh, some 2248kWh over the 4572 maximum. Also, using npowers own tables we know that for the period 1/3/07 - 29/2/08 the 4572 maximum was reached on 14/12/07. Therefore the excess units would be charged after this date. There was a price increase on 4/1/08 resulting in a large differential between the higher and lower priced units.
The second sentence is much less clear. They are comparing 4572 with which 12 month period. The 12 months where the maximum overcharge occurred? The 12 months around the changes? There were two such changes , 1st May and 1st November, 2007. Or are they using the anniversary date the customer joins npower?
The third sentence appears straightforward, but read on.
I have recently seen the bills of a customer who has been compensated under this scheme.
The customer was with npower for a period that straddled the periods of these changes and the period of highest charging, by a large margin
I calculated the additional cost of overcharged units for the year 1/3/07 - 29/2/08. In this case npower had charged even more than the theoretical maximum of 6820 and the additional cost came to over £92.00 incl.VAT. Interest should also be added to this.
The actual compensation received from npower was just over £60.00 incl. VAT and interest.
Curious as to how this discrepancy was caused I made enquiries. They reveal that npower had calculated using the following method. To be fair I haven't seen their calculations but believe this is what they did.
They took the customers starting date which was at the beginning of January.
From that date they calculated on a daily basis (I have no idea how) the amount of units overcharged and applied the applicable price differential until presumably the end of December 07.
They totalled the cost, added VAT and interest at, I believe, an interest rate of 6.6%. Bingo.
It seems to me that they are out to save themselves a lot of money using this obscure method.
By calculating the overcharge on a daily basis from the customers anniversary date they are in this example, using the lowest price differential between then and 30/4/07. At this point the 4572 had not been reached and there was therefore no overcharging to calculate.
This will also reduce the no. of overcharged units available to be costed at the next highest price differential which was from 1/5/07 -3/1/08.
Clearly they have not taken the period the maximum possible number of units this customer could have been charged. Neither are they using the appropriate price differentials.
It would appear that if this is the way npower are approaching payment calculations then it is most unfair.
Using their method a customer who joined on say 1st November, 2005 and remained with them until after February 2008 could have a maximum overcharge of 2248 which cost them over £90.00 but only receive payment for 1024 overcharged units. About £26.00 plus interest.
I would suggest anyone who has their bills check the refund is correct.
My view is that the precise amount npower overcharged each customer is exactly what they should be returning to each customer.
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