ScottishPower to pay interest to customers
April 24, 2009 at 4:48 pm
ScottishPower has recently announced that it is going to start paying interest to its customers if they find they have overpaid on their direct debits, subject to certain limits.
The news comes immediately after Ofgem, the industry watchdog, released a report demanding clearer explanations of direct debit payments and how they are arranged, mainly due to customers having no say as to how the credit in their accounts is used. This led to numerous complaints from customers, notably from Which? magazine, which said that customers were effectively providing “interest free loans” to the power companies, and Ofgem has since imposed new guidelines.
The new interest payments will affect customers who find their accounts between £100 and £500 in credit. These customers will be paid £1 for every £33 that they are in credit, which could affect a large number of the 3.2 million customers who currently pay their bills to ScottishPower by direct debit.
William MacDiarmid, the director of energy retail at the company, said that it makes “every effort” to ensure that direct debit instalments are accurate, so this will go some way to making up for the extra credit in some customers’ accounts.
On top of this announcement, ScottishPower has also introduced a new scheme whereby customers can pay in advance for their power with the guarantee of getting 5% off their fuel bills. This applies to people paying the estimated energy for a whole year in advance, up to £20,000, but will not apply to people just paying for gas. This means that no matter what happens to the price of power over the course of the year, customers will still make a saving.
British Gas hails a significant partnership
April 17, 2009 at 4:06 pm
The UK is the third largest consumer of gas in the world. Unlike other countries in the western world, such as the United States, the UK is reliant on gas for power and fuel more than most and so availability is crucial. Domestic stocks in the North Sea have supplied us for many decades, but as we’re all being told over and over again, the stock-piles are running low and we need a back-up plan. The UK must become a huge importer of gas or be left out in the cold. The latest move has been made between the largest gas supplier, British Gas, and one of the most ambitious and largest gas plants in the world.
Qatargas 2 is a mammoth project unlike any other in the world. Located in the United Arab Emirates, it’s digging, storing and transporting gas but on a huge scale. When it reaches its maximum strength, it’ll be able to produce up to nearly 3 billion cubic feet of gas a day. The gas is converted into liquefied natural gas (LNG) and then shipped all over the world through the hundreds of pipelines. When the pipelines are all operational from Qatargas 2, the LNG will arrive in the UK at Milford Haven in Wales, where it’s expected they will one day be able to supply 20% of the UK’s gas.
The inauguration of the partnership between Qatargas 2 and Centrica, owners of British Gas, marks a huge breakthrough in the potential for gas supply in the UK. With deals like this, it’s not a worry any more that the North Sea is running low but then the environmentalists might not be as pleased with the news.
Ofgem are worried direct debit bill methods are wrong
April 3, 2009 at 4:28 am
There has always been a bit of confusion as to whether or not those people who pay for their energy bills by the nice and tidy method of direct debits are actually paying more for their fuel and electricity than those who do it the old fashioned way at the meter or at the Post Office. Does the anonymity of the monthly bank transfer mean people are being taken advantage of?
At the end of last year there was growing concern that this might be the case, largely coming from the gripe many customers had with huge price rises on household gas and electricity bills that year, in many cases increasing by up to £300. The industry regulator Ofgem waded in, thanks to the summoning from not only the consumer but also the Chancellor, and launched an enquiry into the possible direct debit scandal.
The principal issue being debated was whether the credit level for customer accounts ever went below zero. In other words, were the suppliers squeezing a few pounds more from customers each month without anyone noticing? It was feared that customers who were in credit were being punished because of the debts within the big six suppliers: British Gas aka Centrica, ScottishPower, npower, EON UK, Scottish and Southern Energy and EDF Energy.
However the regulator’s report this month found no evidence at all of any of the energy suppliers increasing their bills for customers who use direct debit payment methods, but that isn’t to say they have been pleased with the way they run this service. There has been a large concern with the clarity of the bills and communication methods for all customers with monthly standing orders. Ofgem feels there is simply not enough regular detailing of how much customers owe and how much they are in credit. Ofgem found that all of the big six failed to explain the price increases adequately last year and didn’t make enough time for customers who are owed refunds of any kind. They fear this slackness could lead to an unnecessary build up in customer debts if and when the price of energy soars again.
