Householders feeling pressured by door to door salesmen
October 30, 2009 at 2:54 am
There was a time when salesmen ringing people’s doorbells trying to sell double glazing were the scourge of British householders but now it seems energy salesmen have taken up where they left off.
As a result uSwitch.com is calling for industry watchdog, Ofgem, to make changes in the regulations governing such sales techniques which, according to research, leave consumers feeling at best pressured and at worst intimidated.
Apparently almost 7 million of us have changed energy supplier as a result of a salesperson calling at our home, phoning us or cornering us in the supermarket aisle. Of this number, less than a quarter felt they had made the right decision. The same proportion said they could have done better with another supplier and around a sixth said they ended up paying more with the new supplier.
The main complaints from consumers, apart from the nuisance element, are that salespeople do not present enough facts for them to make an informed decision, do not allow sufficient time for them to digest the information before making a decision and, of course, that they only represent the one company so that consumers are unable to compare deals with different suppliers.
Over 80% of consumers say that they would not buy from a direct salesperson; over half of us would like to see the method banned altogether, whilst a third would like to see the practice regulated more strictly.
Of course there is the argument that many customers, especially elderly householders, prefer to talk to a human being about their energy needs but direct sales methods are probably not the best way of doing this.
uSwitch spokesperson, Ann Robinson, advises consumers to do their homework carefully before making a decision as “there’s a lot of scope to lose money”.
Power companies say bills could rise next year
October 23, 2009 at 4:28 pm
After all the complaints recently surrounding the energy companies’ reluctance to lower their bills despite much cheaper wholesale costs, they have now warned that bills could actually go up even further.
The news comes following energy regulator Ofgem’s request that the energy companies write to explain how they justified the higher prices. But rather than suggesting that they were planning to lower bills, providers have claimed that bills may increase.
Consumer Focus has been the most vocal surrounding the need for price reductions, and has said it believes “there is scope for price cuts”.
But British Gas said in its letter to Ofgem that prices would probably stay at “historically high levels” adding that bills were “in fact likely to increase” due to the rise in non-commodity costs. Meanwhile Scottish and Southern Energy said that “seeking to avoid an increase between now and the end of 2010” would be one of the main aims for the company.
Ofgem refused to criticise the comments, stating that other operating costs such as sales and marketing also had to be taken into account. The chief executive of Centrica, Sam Laidlaw, said that only 60% of consumer bills are made up by wholesale prices, and the extra 40% was experiencing price rises. This was in part due to the need to meet government green energy targets.
Ofgem also said that it accepted energy suppliers also had to deal with increasing levels of bad debt charges that have risen during the recession as customers have been unable to pay their bills.
But overall the price rise suggestions have been roundly condemned. Energy consultant firm Inenco said that the major energy companies would earn £3.4 billion extra in profits over the next year by failing to pass on the price drops.
British Gas workers in bill-fixing claim
October 15, 2009 at 11:02 am
British Gas found itself receiving some unwanted publicity recently as it had to suspend 30 of its call-centre workers due to a bill-fixing scandal. It has been reported that a number of staff at the Leicester-based call centre were discovered altering their own bills in order to pay less to their employers.
According to British Gas, the workers at the call centre all dealt with the business side of the company’s operations. It also claimed that they did not have complete access to the accounts of other customers.
The staff were able to access the details because they were responsible for making changes to customers’ bills, which are sometimes required in order to make refunds and other changes. However, it seems that it was just too tempting not to delve into their own customer accounts and fiddle the numbers to get cheaper gas and electricity bills.
British Gas states that it has launched a “full and thorough” investigation into the scandal, but has also said that it would be “inappropriate to comment any further whilst investigations are ongoing”.
In all, the call centre employs 1,200 staff, so the 30 who have been suspended only represent a very small percentage. However, according to a source quoted in The Sun, there could have been up to 80 people involved in the scandal.
Although frustrating and slightly embarrassing for the company that its own employees were trying to rip it off, British Gas has confirmed that none of its 16 million customers will be affected in the slightest.
Energy Best Deal a success
October 9, 2009 at 4:04 am
Many of the most vulnerable households in the UK have recently received help from the Energy Best Deal campaign, which was hailed a success by the Centre for Sustainable Energy a few weeks ago.
The campaign is a joint venture between the government’s Department for Energy and Climate Change (which provided the funding), the industry watchdog, Ofgem, and the charity, Citizens’ Advice. The initiative was rolled out last winter and aimed to help low income families make the most of the energy market by providing information and practical support.
Volunteer workers in charities such as Citizens’ Advice, Housing Associations, Sure Start Schemes and Credit Unions were trained to give guidance on such matters as switching supplier, finding the cheapest tariff, applying for grants for energy efficiency measures and making sure that all those entitled to benefits, such as the Winter Fuel Allowance, were aware of how to apply.
Sadly it is the most vulnerable households often lacking in internet access, for example, who would benefit most from online tariffs. Other people have difficulty using the telephone or simply find the whole process of comparing prices too daunting, and frontline workers were able to make a real difference by assisting them.
Anyone who would like to save money on their energy bills should remember that
#Switching provider can save between £73 and £91 a year
#If you really cannot face switching provider, make sure that you are on the best tariff with your existing provider
#If you are having trouble paying your bills you should contact your provider who may be able to assist
#If you are over 60 you will be entitled to a Winter Fuel Payment of between £125 and £400
#If you are on a low income you may be able to claim help in paying for a new boiler or home insulation.
The full Energy Best Deal leaflet is available to download on the Citizens’ Advice website.
Ofgem makes huge changes to tackle global warming
October 1, 2009 at 1:32 pm
In its efforts to counteract the growing problem of climate change, Ofgem has revealed that it will undergo a number of important changes. These changes will include the creation of a completely new branch of the energy industry regulator called Ofgem E-Serve.
The changes have been announced as a result of the government’s plans to prepare the country for the huge changes that are afoot in the way we generate and use our energy. The UK is currently trying to cut greenhouse gas emissions by 34% by 2020, and the restructuring of Ofgem will help it to achieve its targets.
The new E-Serve division will be given responsibility for managing £3.9 billion in funding for green energy projects. This is a huge increase in the £150 million that was available back in 2001, and shows how seriously the government is now taking the need for renewable energy.
The projects will include schemes such as wind energy, carbon capture, solar power and feed-in tariffs. One of its other main roles will be to oversee the installation of smart meters in every home by 2020.
The original sector of Ofgem will also be given new responsibilities which will involve connecting energy produced from renewable sources to the national grid.
Alistair Buchanan, the chief executive of Ofgem, said that “we can play an even greater role in helping to deliver Britain’s energy targets”.
Amidst all the changes, Ofgem has been quick to point out that it will continue to monitor the prices that consumers are paying to ensure that they are getting a fair deal. Much has been made recently about the energy companies’ failure to reduce their fees in line with wholesale prices, so this will be reassuring for consumers.
