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Dodgy energy advice means you may miss the best deal

Energy companies are giving out inaccurate information and dodgy advice to people who call up to switch, our latest investigation has found. But would you expect them to offer you the best deal?

Switch now to save on your winter energy bills! That’s the message coming from the government (and from us), but how can you be sure that you’re switching to the best deal? Can you trust your energy supplier to tell you about its cheapest tariff?

Apparently not. Our undercover investigation into energy telesales found a whole host of failings – from salespeople not telling us about exit fees and giving contradictory advice on fixed prices, to making claims about potential savings which we think are misleading.

But most worrying was the fact that in nearly a third of the 72 calls we made energy suppliers didn’t tell us about their own cheapest deal – despite the fact that we asked for this specifically.

Simple answer to a simple question?

We know energy tariffs are highly complex – our last investigation found that even accountants couldn’t calculate the cost of energy tariff – but you’d expect energy companies to be able to give a straight answer about their own deals.

But they aren’t doing this.

We’re talking to the energy suppliers and Ofgem to try and get this sorted out, but would your supplier be the first place you’d go to for a cheaper deal?

Call or go online?

I don’t know about you but the thought of calling any energy supplier fills me with dread (too many flashbacks to my days as a student in shared houses spending hours trying to sort out ex-tenants’ bills).

I’d much rather just go on a comparison website like Which? Switch and see all the deals available to me, have a good look at all the details and make my mind up from there.

But many people do switch over the phone – 25% of gas customers and 28% of electricity customers last switched this way according to Ofgem. And it’s for this reason that we need to make sure that anyone who calls their energy supplier asking for the cheapest deal is told about it. Where do you go to find the cheapest energy deals?

Do you think you're on your energy supplier's cheapest tariff?

I have no idea (44%, 184 Votes)

No - I'm sure I'm paying over the odds (36%, 152 Votes)

Yes - I'm on a great deal (19%, 81 Votes)

Total Voters: 417

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Comments
Guest
Alan Irons says:
13 October 2011

EVEN THE ENERGY OMBUDSMAN IS CONFUSED!

I’ve just spent 10 months fighting Scottish & Southern Energy (SSE) concerning inaccurate tariff advice.

I am a negligible user of gas in the summer months and suspected as far back as 2004 that a No Standing Charge (NSC) tariff would be cheaper than my Standing Charge (SC) tariff.

In December 2010 I challenged SSE that it’s “Domestic Standard Nil Standing Charge” (NSC) tariff should result in a saving of £34/year (based on my 2009/2010 gas usage readings) relative to the comparable Standing Charge (SC) tariff option. SSE initially falsely claimed that the NSC tariff would result in a saving of only £1.70/year relative to the comparable SC tariff option. It took a further 5 emails and persistent pressure before SSE finally admitted, but only after I had emailed my calculations to them and referred them to the pricing conditions on their own website, that my calculated savings of £34/year were correct!

I then tried to get SSE to accept the fact that “the NSC tariff is always cheaper, or no more, than the comparable SC tariff”. This stems from the fact that the NSC kWh surcharge (currently 5.3 p/kWh) which applies to the first block of units used in any one quarter (currently 625 kWh) is invariably virtually identical (in this case NSC surcharge is 5.3p * 625kWh = £26.87/quarter) to the quarterly standing charge in the SC tariff (in this case £27.35/quarter).

Put simply, any consumer who uses less than the quarterly block allowance will make a saving whilst any consumer using more than the quarterly block allowance will be no worse off. The NSC tariff is good news for consumers with low summer gas usage (eg. people with energy efficient houses, people with solar water heaters, etc) but bad news for the utilities as they have to read the meter every 3 months and will loose some revenue.

SSE persistently denied that my conclusions were correct but has failed, despite repeated challenges, to provide a calculated example of where my findings are in error.

In January 2011 I took this case to the Energy Ombudsman who has found in my favour on virtually all counts and requested SSE to pay compensation. HOWEVER, to my surprise, the Energy Ombudsman has failed to insist that SSE substantiate its claim that my findings regards the relative cost of NSC and SC tariffs are in error.

After 10 months, approximately 60 emails and many hours spent on the phone I am left to conclude;

– SSE staff (even senior customer services staff) appear to be incapable of understanding their own tariff structures and providing accurate tariff advice to customers.

– queries addressed to SSE are frequently met with replies that are either; not relevant to the question, evasive, contradictory or implausible.

– the Energy Ombudsman service is slow, ineffective at addressing the core issues of complex complaints and too willing to accept unsubstantiated claims made by the utilities.

– the compensation payments offered are derisory relative to the time and costs experienced by consumers and are totally inadequate to prevent the utilities from repeating their misleading and inaccurate claims.

– I remain confused whether my understanding of NSC tariffs is correct or not!

Has anybody else had similar problems with SSE?

Guest

I switched to Co-operative Energy in July 2011 and have been very pleased with the result. They provided coherent simple instructions on the transfer and forewarned me, correctly as it turned out, that Scottish Power would try to retain me by offering what appeared to be a good deal. Co-operative Energy have just one tariff which is absolutely clear so no confusion. Our dual fuel bill reduced from £110.00 to £87.15 per month currently. They are a mutual and an ethical business so I don’t have to worry about paying shareholder profits as their customer/members are stakeholders in the business are are rewarded with a share in any profits. Anyone wishing to benefit from this can check out the details at:- http://www.cooperativeenergy.coop/ I hope this helps. Steve Putman 14/10/2011

Guest

Why do different tariffs exist anyway? Perhaps I would understand a discount rate if you have both gas and electric from them, but looking at Which? Switch, for each operator there are a myriad of tariffs.

Why?

Surely you have a gas pipe and an electrical supply, gas and electric are constants, suppliers should be limited to a maximum of 5 tariffs. Anything else as Alan has indicated is just there to completely confuse everyone so that you end up paying more than you should.

How can they get away with this? You either have gas/electric or you don’t

Guest
Rich says:
13 October 2011

‘But most worrying was the fact that in nearly a third of the 72 calls we made energy suppliers didn’t tell us about their own cheapest deal – despite the fact that we asked for this specifically’

This statement clouds the results- energy suppliers are different companies- Scottish Power scored 11/12 3 others scored 10/12 so out of the same results you could say the following statement:
‘The Majority of the big six scored 10/12 or above’

This study was really silly- its just a bandwagon study- really poor work Which?

Guest

Hi Rich, thanks for your comment. I don’t think that one sentence can ever give the complete picture of an investigation – and yes some companies did do better than others.

But none of the companies gave us their cheapest deal in every call – and there really is no justification for this. Anyone who calls up asking for the cheapest deal should be offered it and companies should be giving out consistently correct advice. A score of 10/12 is better than others but this still means a sixth of advisers are giving out incorrect information.

The stat of ‘a third of calls’ is looking at all the companies overall and I think it offers a fair summary of what we found.

Guest

It always appears that the Energy Companies increase their tariffs at the same time – I find that strange if they are not conferring with each other. Part of the cause of the high increase is a F
Government Tarrif to sustain the Solar, Wind, and Wave power. Two of these are not economic nor justifiable if the subsidies are taken away!

Guest
Kevin says:
14 October 2011

The energy companies are so bad communicating their best tarrifs in order to con the public. I used Which switch and found that the best deal for me was with Scottish Power who were my current supplier. No attempt by them to tell me of the cheaper tariff. THe companies should not have been privatised in the first place. Having all these different “suppliers” is wrong, no matter who I pay the bill to, the electricity and gas I use comes from the same source. Having other private companies as third and sometimes fourth party retailers all adding their profit to the final price is ridiculous.

Guest
Andrew Kneeshaw says:
14 October 2011

I had a renewal offer from Scottish power claiming that they’d give me a discount on rolling over an existing internet based contract. Looking at your comparison site, I found they offered a cheaper deal but the tariff code was slightly different. I rang and asked if this alternative was cheaper. They said yes and immediately put me on it. But why didn’t they do that in the first place?