Categories
ADR Ombudsman Latest News Topical Utilities

Energy crisis – what you need to know

The full guide regarding the energy crisis

Gas prices have gone up 250% since January and 70% in the last month.

At the point of publishing, the companies Utility Point, People’s Energy,  Money Plus Energy, PFP Energy and Hub Group have ceased trading and Ofgem is arranging new suppliers for the customers of those companies. Others are in crisis talks.

Gas flame on stove

Why is there such an increase?

This has been caused by a number of factors and the Guardian article What caused the UK’s energy crisis? outlines in detail all the things that have happened to come together to cause a “perfect storm”.

  • Increase in supply from Asia particularly China and Latin America.
  • Decrease in supply from Russia.
  • Gas is normally stored in the Summer months, but the globally cold Summer meant gas supplies down.
  • 50% less wind last year so that storage is down.
  • Covid has meant more supply of gas.
  • The price cap on energy is removed on the 01/10/21

The current energy crisis is causing worry for many of us. Wholesale gas prices in the UK have more than quadrupled over the last year. Nuclear power plants have been forced to undertake unplanned outages for maintenance, a main power cable used to import electricity from France was shut down after a fire, and the UK’s wind turbines have slowed during some of the least windy months since 1961.

So, where does it leave consumers. What do you need to know?

What does Ofgem say?

A spokesperson for Ofgem said:

“We know that the current situation with high wholesale energy prices is putting pressure on customers and energy companies. This is a global issue.

We have the systems and processes in place to ensure that customer needs are always met.

For those customers who are with energy companies that can no longer trade, a new supplier will be appointed. Ofgem is working closely with government to manage the wider implications of the global gas price increase.”

What does Government say?

The Department for Business Energy and Industrial Strategy (BEIS) said that

“Ofgem has robust measures in place to ensure customers’ gas and electricity supply will continue uninterrupted if a supplier fails, however, if the appointment of a Supplier of Last Resort [a new supplier] is not possible, Ofgem and the government have agreed processes in place to appoint a special administrator to temporarily run the business until such time as a new supplier can be found.”

My supplier has gone bust – what should I do?

You are protected by the regulator, Ofgem.

It will step in and inform you of your new supplier. This is known as “supplier of last resort”. This is well named, as it may not be the best deal! But you can and should look to switch when things settle down. You should hear within a few days of your company going bust.

The new supplier will place you on a “no exit fee” tariff. Ask the supplier to put you on the cheapest tariff.

The importance of switching energy suppliers and telecom providers on ITV News

What actually happens?

 Ofgem normally invites suppliers to bid to take on the accounts of those companies that have gone into administration. This helps them get the best deal for consumers. It is slightly more difficult at the moment due to so many being at crisis point and the negotiation needed to take on debts as well as credits. This is why there is a lot of discussion around the likelihood of so many suppliers going under, as the smaller ones may not be able to take on new customers and any debt.

This process should only take a few days.

Is there any possibility of having my energy supply cut off?

No. Regardless of whether you owe money or not, Ofgem’s safety net ensures that supply will continue. You will not notice any difference other than receiving a letter from your new supplier.

Should I switch supplier now?

No. Although switching is usually a good idea and you can usually save a lot of money, there is currently too much turmoil in the sector to be sure that you are getting the best deal. Wait until things have settled down.

It is also possible that you may lock yourself into a deal and the price of wholesale gas will come down.

What’s the price cap?

Price caps on put on out-of-contract energy deals. From 01/10/21 the current price cap will be upped and will add, on average, £139 toon average to annual bills. This will be more if you have a prepayment meter or use lots of energy.

I’m in the middle of a switch – what do I do?

The switching process will continue, as normal. You will move to the new supplier. If the new supplier is one that has gone bust you will automatically be moved to the one that has taken over.

I think my supplier may go bust – what should I do?

Sit tight and wait. But do take a meter reading for your electricity and gas meters so that you know how much energy you have used.

You may not be able to access your bills if a company goes bust, so make sure you download the bill so you have the evidence.

I am in credit – what will happen to my money?

The new supplier shouldn’t take any payment if you are in credit. You should also be refunded your credit. How this will be done will be explained to you by the new supplier.

I am in debt – what will happen?

You will need to pay the debt to either the old supplier’s administrators or the new supplier, depending on what deal is agreed between the old and new suppliers.

I’ve got a smart meter – what happens to me?

You will still be transferred to another supplier. However, if your new supplier cannot operate your meter in “smart” mode it will put you into a “dumb” meter mode, using your existing one. Your smart meter will work as a smart meter again if you switch to a supplier that can operate with smart meters.

What should I do about the direct debit?

The new suppliers will explain to you what will happen with your direct debit but you can cancel and set up a new one if you wish to do so.

I can’t afford the new bills – what do I do?

Notify your supplier as soon as possible as you may be able to set up a payment plan.

Look to switch as soon as you know your new supplier. Use more than one comparison website. Also look direct with the cheapest on the comparison site as they may have a deal or you could use a cashback site. See my article Do Morethan just comparison websites for insurance quotes!

If you are vulnerable you should already be on your supplier’s priority register

Ofgem provides help with links from its page Getting help if you can’t afford your energy bills. Its rules state that suppliers must work with you to help you. This includes setting up a payment plan, breaks, more time to pay, access to hardship funds and details about the Priority Register. If you are vulnerable you should be on your supplier’s list.

There may also be access to hardship funds and grants from various organisations. You may also get 60 days’ space from creditors to focus on getting debt advice and setting up a debt solution. An excellent site for Debt advice is Debt Camel.

I currently have a complaint with my supplier which has gone bust – what can I do?

Unfortunately, there is no requirement for the new supplier to resolve your complaint. However, if the issue persists with the new supplier you will need to discuss the matter with them.

If your matter is with the Energy Ombudsman, then wait for it to contact you to discuss what will happen.

I don’t know who my supplier is!

Don’t worry! You can find out your gas supplier by entering your details into Find my supplier or phoning the Meter Number Helpline on 0870 608 1524 (7 pence per minute).

You can find out your electricity supplier on the Energy Networks Association’s website. Use the Lloyds register providers list to find independent operators.

Other help regarding energy

Electricity pylon Everything you need to know to complain about energy problems

 

 

Everything you need to know to complain about energy

 

 

 

 

A spokesperson for the Energy Ombudsman said ‘As an organisation committed to supporting consumers, small businesses and energy suppliers through dispute resolution we are acutely aware of growing concern around the future of the energy sector and the accessibility of their services. We are working closely with industry to ensure that we can provide relevant information and support to those that access our services. Ofgem’s safety net protects customers of affected companies by ensuring that their energy supply is not disrupted and that domestic customers outstanding credit balances are protected.

For customers affected by suppliers who have ceased trading, we echo Ofgem’s advice to record a meter reading and not switch suppliers before the transfer Is completed. For those who’ve registered disputes with our service, we’ll provide an update as soon as Ofgem appoint a Supplier of Last Resort (SoLR) and there is clarity around whether or not the new supplier will be in a position to help with your case.’

Categories
Latest News water and energy

Freezing energy problems? Your rights all you need to know

Energy problems related to bad weather and your rights

 

snow high up from ground to treets

 

Left out in the cold by your energy company? All you need to know about your rights

Well this is a Winter and a half isn’t it? Quite incredible. It is inevitable that many people will have had problems with their gas or electricity supply We just had a bit of emergency with the water tank too! So, in exceptional circumstances such as this weather, what are you rights?

I think one has to be aware that these are truly out-of-the-ordinary circumstances and to understand that energy companies are not going to be able to get to customers as quickly as they would normally. They have both the significant increase in call outs, but also it is as difficult for their repair people to get to you as anyone else driving. With all the accidents and deaths caused in this weather I do think we need to be aware of that. None of us would want someone to risk their life to fix our boiler, I’m sure.

However, companies should be doing all they can. They should have more staff in place during the Winter months and have emergency plans in place to deal with increased enquiries at times like this. You do still have rights and can claim for lack of gas or electricity supply and lack of service.

Your rights with weather-related energy problems on electricity pylon

Vulnerable Customers and your rights

Energy customers who are vulnerable (and usually you need to be on the company’s list as such) will take priority for any loss of supply or repair.

If you are struggling to get in contact with your provider, keep a note of all times you called, tried the website etc., as evidence to use in a complaint at a later date.

Your rights when there is a cut in your energy supply

In the case of a cut in your gas or electricity supply, it is your distributor, not the supplier, who is responsible. You can find out who your gas transporter is here and electricity supplier here. Complain to them if necessary.

In the event of an unplanned power cut you are entitled to set amounts of compensation. For electricity this varies depending upon the number of homes affected, how long you are without supply and how Ofgem categorises the storm.

From the Ofgem website:
Service Guaranteed Standards payment
Supply restoration: severe weather
The time you are off supply before being able to claim varies according to severity of storm. This is because
the companies will have more work to do to fix faults.

Storm category 1: After 24 hours
Storm category 2: After 48 hours
£70 for domestic and non-domestic customers.

A further £70 will be paid for each additional period of 12 hours in which supply is not restored, up to a cap
of £700 in total.

This applies to both storm category 1 and storm category 2

More on  power cuts (e.g. multiple cuts) can be found on Ofgem Know Your Rights Power Cuts page.

For gas you will be paid £30 plus £30 for each 24-hour period without gas. See 1 little Known Fact You Need to Know When Your Gas is Cut Off!

If you are on the Priority Services Register or a cut was due to bad weather you SHOULD get the payment automatically. Keep an eye out though and claim if you don’t receive it.

You should be paid with 10 days of the end of the power supply cut if automatic and within 10 days from any claim. If not, make sure you get the extra £30 entitlement for that breach of the Standards.

Also useful to know… if you have more than 4 power cuts in one year you are entitled to £75. (The year runs from  01 April to 31 March).

Energy companies and customer services

Energy companies are covered by the Consumer Rights Act 2015 and so you are entitled to services to be carried out with reasonable skill and care.

Cold weather payment

This is different to the Winter fuel payment. If you receive certain benefits and the temperature was forecast to be or is zero degree celsius or below for seven consecutive days you will receive £25 for each 7 day period between 1 November and 31 March. You can check if you are eligible and whether you will receive the payment (you do not need to claim it will be automatic) on the Government Cold Weather Payments page. Details for how to claim if not received are also on the site.

Boiler and heater breakdowns and cover

You will need to check your policy. But in general if the company has been unable to undertake the repair you should be able to employ another tradesperson to do the work. British Gas for example has said that “some Homecare polices will cover reimbursement for work we are not able to do which is then done by a third party, if the work is covered by the policy. Customers should check their policy if they wish to claim for a reimbursement. They will need a VAT invoice from their tradesman in order to claim.”  When SE leaves your elderly aunt without adequate heating for 11 days…  tells the story of what I did to claim when they did that to my aunt!

Other help with complaining to get refunds

See Ofgem Standards of Conduct and Quality Standards for what you should be able to expect from your supplier. If it fails to meet the level of service required it must make a compensation payment. However, note that they do not need to do this if severe weather makes it impossible to restore the supply. See above for this.

See All you need to know to make a complaint about energy for more information including how to complain when a provider leaves a vulnerable customer without supply, about bills and how best to prepare a case for the Energy Ombudsman. See Top 20 Tips How to Complain! should you need to start getting your case together!

Left out in the cold by a rail company? Your rights if you have been affected by train delays or cancellations.

Your rights if your water supply has been interrupted

How to Complain: The Essential Consumer Guide to Getting Refunds, Redress and Results!

 

GET THE BOOK! How To Complain: The ESSENTIAL Consumer Guide to Getting REFUNDS, Redress and RESULTS!