Moneywise helps a reader having problems with their energy supplier
Switching energy supplier is an easy way to save money. Depending on which supplier you’re with, you could save up to £300 a year by moving to a cheaper provider.
Yet millions of people haven’t switched or don’t switch regularly. You’d think they’d be happy to pocket a couple of hundred pounds for half an hour’s effort – the time it should take to switch online.
I’ve been writing that advice for years, but more and more rumblings reach me that switching can lead to problems, not least because many of the smaller independent suppliers simply aren’t geared up to deal with customer complaints properly.
Here’s a shocking fact: some 15 independent suppliers have gone bust in the past 18 months. These are Solarplicity, URE, Cardiff Energy Supply, Brilliant, Our Power, Economy, Extra, Spark, Future, National Gas and Power, Iresa, Gen4U, Usio, One Select, and Electaphase.
Some of these companies attracted tens of thousands of customers by undercutting their rivals to offer the cheapest deals.
When they went bust, their customers were protected by the energy watchdog Ofgem, which arranged for another company to take over their accounts. But that means there are a lot of people out there who have ended up with a company they may not have heard of and didn’t sign up for.
It has been a growing problem in the energy supply industry – companies have been able to set themselves up with seemingly minimal checks and are not equipped to deal with customers.
The regulators have closed that loophole, and now firms have to jump through more hoops before they are given a licence to supply.
But there remain plenty more out there promising to save you money by switching without always having the necessary customer service.
Take Bulb Energy: it has been busy offering £50 to people to join it, as well as another £50 to those who recommend it. It is a quick way to build a business and a nice extra for customers– but not all who have joined have ended up delighted.
PM of Nottingham contacted Moneywise after noticing 15 bill corrections on his account for thousands of pounds soon after he joined the company in April.
“In one month, it claimed we had used £1,871.79 worth of energy, which is nonsense. There were 12 corrections to my account on 26 May and three more on 25 August.”
The company gave him an incomprehensible explanation for the problems, leaving him worried about future bills. And then there was radio silence.
Moneywise challenged the supplier. It responded within hours and finally, this time, with a more credible explanation.
It said: “The bill corrections were due to delayed meter exchange results when PM’s smart meter was exchanged. This caused a bill failure on the account for a few months, which was fixed in the form of a consolidated bill for the entire period since he joined Bulb.
“He should only have been re-billed for the period since his smart meter was installed, so it seems like our error for billing for the entire period.”
The company promised that billing would return to normal with no more alarming amounts appearing. But it cheekily added: “As a result of the backbilling, the account is actually now in credit, so it has benefited PM’s account in that way.”
That is some benefit – being forced to pay early before even using gas and electricity.
PM was pleased that the situation was resolved, but still far from happy with the firm.
“Bulb offered me some compensation, which I have accepted,” he said. “They still haven’t really explained why the billing went nuts, but you can only bang your head against a brick wall for so long.”
He accepted £30 compensation for the billing mistakes plus another £10 for an unacceptably long wait on the phone trying to contact the firm.
Of course, this is a one-off mistake that may not have hit any other customers, but the fact that it left one person fed up shows that Bulb needs to up its game when it comes to customer service and dealing with problems.
“I have no faith it won’t happen again,” PM said. “But thank you for your help.”
I am currently dealing with two other small independent energy firms and will report back on them in a future issue.
OUTCOME: Reader gets £40 compensation for billing errors
Do you have a money question for our experts?
At Moneywise, we have a panel of top experts to help with your money and investing questions. If you have a tax issue that’s keeping you awake at night, a question about investing that you’ve always wondered but been too shy to ask, or even need a full money makeover for free, we’d love to hear from you.
If you have been treated unfairly by a firm send the details to Moneywise’s Fight for your Rights and we could take up the fight for you.
If you have a question about your investments or investing in general, put it to our Investment Doctor.
If you have a question about your personal finances – anything from tax to state pensions, inheritance tax, property sales and more – write to our Ask the experts panel.
Would you like a full money makeover? We will arrange a free one-to-one meeting for you with an FCA-regulated independent financial adviser worth over £2,000.
See Moneywise.co.uk/money-makeover for more details.