13 October 2011 / Home & Energy

Dodgy energy advice means you may miss the best deal

Comments 20

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

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?

Reply Hide replies ∧

Schnookie says:

14 October 2011

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

Dean says:

13 October 2011

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

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?

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Hazel Cottrell says:

14 October 2011

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.

Anthony Walker says:

14 October 2011

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!

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.

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?

Andy says:

14 October 2011

I don’t know what the problem is. It is not rocket science to work out your consumption and project that forward to see what you will be using over a year, split down to seasons, month, even weeks if you prefer.

I agree the energy companies are lying toads but this is more a reflection of how dim the general public is that they cannot work out their electricity bills. You could equally s**g off Sainsburys, Tesco or your corner shop for pointing you in the direction of more profitable produce.

Perhaps people should look inward more often rather than simply seeking to blame the big bad corporate supplier for their own shortcomings.

Reply Hide replies ∧

Bill says:

14 October 2011

Andy, I don’t think working out of your consumption is the issue, it’s apply this to the multitude of tariffs that exist in each company and then, after working out the best, comparing each of them with the best tariffs of other companies. I agree with you about all suppliers are lying toads and that’s best demonstrated when they talk about the wholesale prices. For instance as far as I can see the cost of wholesales natural gas has hovered around the same price for years. Most of the power stations in England are Gas Fired. So why is it that the cost of electricity is less than the cost of gas? Gas is use to create electricity by heating water to turn the turbines so you need all the workers in the power stations, the admin costs of getting the supply to our homes, etc, etc. So these are all added to the cost of the gas used to create the electricity. And yet electric seems to be cheaper than gas. Seems strange to me.

Hazel Cottrell says:

17 October 2011

I agree with Bill – it’s working out the tariff costs that can seem like rocket science.

In our recent tariffs investigation, we asked 36 people with professional qualifications to work out tariff prices on standard tariffs from Eon, Scottish and Southern Energy (SSE) and British Gas.

Only one of the 36 – a company director – could do it. And a maths expert we consulted told us that even A-Level mathematics students would struggle to work it out.

(http://www.which.co.uk/campaigns/energy-and-environment/tackle-tariffs/our-tariff-investigation)

We are campaigning for simpler tariffs to be introduced – so consumers can compare prices at a glance.

Bill says:

14 October 2011

Using the Which online comparison pages, very good by the way, earlier this year I moved from Southern Electric (SE) to British Gas (BG) and immediately noticed a significant drop in the cost of my electric and gas supplies. What annoyed me was that as soon as I told SE that I was changing suppliers they offered to beat the tariff I would be on with BG. Despite being annoyed about this, and the fact that they never suggested a better tariff while I was a customer, I really couldn’t trust them and went ahead with the change. Also when I initially moved to my current address and took over the SE accounts, I gave them my mobile number, something I don’t usually do but I didn’t have a landline at the time. Almost immediately I started getting texts and phone calls offering all sorts of stuff I didn’t want. I’m pretty certain that SE sold my number together with those of other customers to earn a bit of extra profit.

John Ward says:

14 October 2011

We switched from EDF to Scottish Power about a year ago but immediately afterwards the tariff rates were jacked up significantly. Corporately SP must have known this at the time yet still marketed their new tariff aggressively and captured a number of new customers who were suddenly facing much higher bills than they had left behind. I did not trust SP not to do it again and I didn’t much care for their general marketing behaviour either. Like Schnookie [above], I recently signed up with Cooperative Energy because I liked their fair, open and ethical conduct and I think we shall stay with them for as long as possible because of their honest approach and intentions taking the long-term view. We are probably paying a bit more each month than we might otherwise have done but for us it is not only about money; we just feel more comfortable dealing with an organisation we can inherently trust. SP did try to tempt us back, to no avail, and they charged a whopping cancellation fee on each supply completely wiping out the credit we had accrued over the summer period. I had not expected that but it was probably in the small print of the contract. Once I have been annoyed by a company I will never go back to them whatever they say about how they have reformed so EOn, NPowerr, BG and SP are all beyond the pale for us now. Perhaps we should have stayed with EDF – at least they never got up to any silly tricks – but we are very happy with Cooperative Energy [we even appreciated the considerate and informative way in which they notified customers of their recent – inevitable – price rise]. Loyalty is the equation of Trust so we expect to put this whole energy comparison hoo-hah and annual switching malarkey out of our minds for a very long time ahead.

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snori says:

14 October 2011

I agree entirely with John’s comments regards the unethical conduct of the big 6 power utilities.

I switched to Atlantic Power (a small independant) in 2001 – their tariffs were simple to understand and customer service was excellent.

In 2004 they were taken over by Scottish & Southern Energy (SSE) and the service deteriorated rapidly with respect to;
– lack of accurate meter readings
– poor energy usage estimates and occasional gross overcharging
– introduction of complex & erratic pricing structure with wildly varying energy costs and standing charges
– erratic Direct Debit variations resulting from the above which resulted in my account being grossly in credit if I didn’t closely monitor the situation.

SSE’s customer service is truly appalling – the staff appear to be incapable of providing accurate tariff information or providing direct answers to simple questions.

When the power industry was privatised in the ?1980s we were led to believe that the industry would be more efficient and costs reduced. We appear to have ended up with a “monopoly” of 6 faceless giants who have little respect for either the customer or the regulators.

Margaret says:

15 October 2011

Scottish Power reduced my monthly dual fuel dd payments by £20 in August having switched to them in October 2010. They emailed me in September this year asking if I wished them to continue supplying me for a further 12 months. Guess what! My monthly dd payments have just been increased to £85!!! What a con!!!! It’s obvious from the above comments that the BIG SIX are operating cartels but nothing is being done to stop this malpractice.

Rozmar says:

15 October 2011

I recently used Which? switch and chose to move away from Scottish Power as the deal was cheaper. Since then I have been bombarded with calls telling me that I am wrong, that Scottish Power can offer me a cheaper deal, that I will pay more. Already the monthly debit payment is less that it was, and Scottish Power owe me money! I told them I was going to switch as agreed, and have still been phoned by other reps as if I haven’t had the conversation. I won’t switch to them in the future.

DaveG says:

15 October 2011

I live in a terraced house,with loft insulation,double glazing and cavity wall insulation.We changed our old boiler last year with the £400 allowance.Have been with Scottish Power for several years and have no complaints.Last year I paid £72 per month for dual fuel,and at end of year received cheque for £105,and was £180 pound in credit,which I asked them to keep in my account for this year.My monthly debit has now been reduced to £49 per month.we do not live in a cold house with extra clothing.I speak to the girls at Scottish Power and they advise me the best deal available.The new boiler has made quite a difference.

MikeT says:

15 October 2011

My point is indirectly related to switching. However; seeing that my most recent duel fuel bill from nPower was dated April 2011 I requested an updated bill. It has taken me several weeks to get the updated bill. Among the info was that my monthly payments would be increased to £83. But when I read the entire bill it became clear to me that the forecast cost of fuel usage equates to £76 per month.

To keep my point simple………… the game being played is that nPower bank the £83-£76=£7 each month and then rebate that amount [what they deem as Duel fuel Discount] if I’m still with them next April [the anniversary of my account]. This charging component of £7 per month has nothing to do with fuel and nPower earn interest on it!! They don’t charge VAT on it.

Having challenged nPower they say they will amend my monthly SO to £76.

To me it’s an outrageous Con by nPower.
Heads they Win, Tails nPower consumers are being screwed.

Don’t naively switch – it’s the ’bottom line’ that matters – challenge your fuel supplier!

Derek says:

22 February 2012

My energy provider Scottish and Southern have now approached me to take up their telephone and broadband service, which they say will be cheaper than my current provider being Zen. S&S will give me £40.00 off my next electricty bill if l take this service, plus a saving on broadband and phone bills of about £7-9 per month, over a year seems worthwhile deal, Has any else taken up this service from S&S, and what feed back have they had, i.e good or bad?

peter o says:

9 November 2012

Garbage in – garbage out…
TARIFF ERRORS on the WHICH? Switch service render price comparisons meaningless.

I have used the Which? Switch service over the last couple of years to check the latest deals on gas and electricity. With their help, I’m now with Ovo Energy on a dual fuel fixed tariff that’s due to expire in mid November 2012.

Thanks to Ovo’s clear pricing, my total annual consumption data, energy costs and tariff rates are very easy to work out and codify. Having carefully entered accurate details about my current tariff and energy consumption data on the Which? Switch comparison site, I noticed that their tariff data (i.e. the charge rates for gas and electricity and the standing charges) are inaccurate. In effect, these data errors have produced estimates of my total energy consumption that are £58 dearer than they really are.

Now, being £60 adrift isn’t a big deal in the greater order of things, but when you take into account that three energy suppliers are competing for my business with margin of savings of only £50, you will appreciate that the Which? Switch calculator is only as good as the data held in it.

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