/ Home & Energy

Brief cases: energy firm pays up in bill dispute

energy bill

Which? Legal member Keith Smith asked for help with an energy bill dispute. He switched energy companies while in credit with his old supplier and it failed to give him back most of the money he felt it owed him.

At the time Keith switched his gas and electricity from Sainsbury’s Energy, he was more than £300 in credit. But the firm only repaid him just short of £56.

Keith switched on 22 July 2016 and received final account emails showing he was owed £260.50 for gas and £55.83 for electricity.

But Sainsbury’s Energy paid him only £55.83, claiming he owed them for energy used up to the time of the switch, despite having given him a final account email saying otherwise.

Keith contacted the company for clarification, but when he received no reply, he asked Which? Legal for help.

Our advice in the energy bill dispute

We advised him to make a complaint to Sainsbury’s Energy and said that if he was unhappy with its response he could request a ‘letter of deadlock’, which would allow him to take his complaint to the energy ombudsman.

Sainsbury’s Energy failed to reply, so we advised him to write to its managing director with details of his complaint.

This time, the company did respond, but still claimed that the bills were accurate and Keith wasn’t entitled to £260.

It implied that it would be open to reaching an agreement with him – but then failed to respond to numerous emails that he sent over several weeks.

Eventually, the company did reply and said that, as a goodwill gesture, it would pay him the balance of £260.50. It said this was due to the continued shortfalls in customer service.

Keith accepted the offer.

The law

Sainsbury’s Energy continued to claim that Keith was not owed the £260.50 balance because it was used to offset the final gas use. But it couldn’t deny the terrible customer service he’d received.

In English law, you can’t usually claim compensation for time wasted, inconvenience and distress, but these factors could have been borne in mind by the energy ombudsman in reaching a decision, if Keith had gone to it with his complaint.

The ombudsman can assess what is fair and reasonable in the circumstances and factors, such as whether the company followed its Code of Practice, may be considered.

Keith’s case demonstrates how it can be worth pursuing a company that falls short of acceptable customer service standards.

Have you been in credit with an energy company when you’ve tried to switch? What happened?


Comments
Profile photo of wavechange
Member

When I switched my dual fuel supplier from e.on to Ovo I received a refund only for one fuel, so I was in a similar position to Keith Smith. I contacted Ovo, received and apology and received a prompt refund. Mistakes like this should not happen and could be overlooked. However, if a mistake has been made, the company should act promptly to resolve it. The same applies with other organisations, such as councils.

Member
Colin says:
21 November 2016

Did you not mean e-on? I’m about to leave OVO.

Profile photo of wavechange
Member

You are right, Colin.

Profile photo of John Ward
Member

Keith got his money back in the end . . . but what an ordeal. Consumers shouldn’t be having to doing this to get what is rightfully theirs. It is too easy for companies to buy their way out of bad customer service and billing errors; it might give monetary satisfaction but it leaves the underlying problem unresolved. Where are the real sanctions against companies that treat their customers with contempt? What is the point of the government and Ofgem urging people to exercise their option to switch if firms are going to make it financially very difficult? I believe it should be possible for Sainsbury’s Energy’s performance in Keith’s case to be reported to Ofgem for disciplinary action.

If I decide to change energy supplier while I have a credit balance I am going to cancel the direct debits until the credit has been used up.

Member

I must admit I was in credit with eon when I came to the end of my tariff and changed, to be fair they automatically put the overpayment back in my bank account.

Member

What I really do not understand about these energy companies is their reluctance to lower prices. I was on a collective deal with Eon last year though ‘Cheap Energy Club’ which is Martin Lewis’ lot as no doubt lots of other people were, when I came to the end of the tariff period they increased their prices so I left them and switched to the new deal that ‘Cheap energy Club’ had negotiated with British Gas which was in fact cheaper than last years Eon prices. If Eon had lowered or kept their collective deal tariff prices I am sure people would have opted to stay with them instead they lost the people they had previously gained. Was it greed or lack of foresight from Eon management.

Member
The Badger says:
25 November 2016

“What I really do not understand about these energy companies is their reluctance to lower prices. ”

As an employee of a large energy company, I can answer that. All of the prices offered to new customers are unprofitable, so as a business you’d commit suicide by offering “customer acquisition” prices to existing customers. Whilst this sounds harsh, it is exactly the same as say car or home insurance markets, where the best deals are offered only to new customers.

If people want everybody to have those low prices, then the prices won’t be that low, because suppliers can’t charge unprofitable prices to everybody. So your choices are switch, save, let the indolent pay. Or demand very slightly lower prices for the majority, and no savings for savvy consumers.

What is it to be Which?

Profile photo of malcolm r
Member

The answer is to charge everyone the going rate(s) for that particular supplier. Stop subsidised fixed price tariffs, offer a small range of tariffs that suit different customers needs and attract customers by real competition, not bribes. However, where there is competition for our business all sorts of offers are made, and have been for many years, to attract new customers hoping they will then stay. I suppose the web has been partly responsible for this, as so many of us search quickly for the “best deals”, whether on products or services. Being “savvy” – having knowledge and the ability to use it – helps in all facets of life; negotiating privately or in business, in public life, and it will never go away as a useful asset.