December 03, 2008

The British Gas saga

How do they get away with this? It is simply daylight robbery and the Energy Ombudsman is completely and utterly toothless.

It started in August 2008. British Gas must have spent a huge amount of money (at least we know where they're getting it from) on a massive publicity campaign, both on the television and in leaflets through letterboxes, urging customers to sign up to the "Price Protect 2011" tariff. The principle of this tariff is certainly attractive: no matter what happens to the cost of energy, your energy bills won't go up until 2011.

Sounds good, right?

We were already on the "Price Protect 2009" tariff and there was nothing to indicate that the "2011" scheme was anything other than an extension of what we already had, so we called British Gas and signed up for this new thing. A few days later we received confirmation through the post that we were now on the "2011" scheme. So far, so good.

Late September we received another letter stating coolly that our monthly payments for electricity would be going up from £29 to £67. That's a 131% price hike! Where's the "Price Protection" in that? We called British Gas to complain, saying that we simply couldn't afford that kind of price increase, that some kind of solution had to be found and that we were looking forward to a proposal through the mail. British Gas "justified" the increase in terms of an increased tariff (wasn't ours protected until 2009?) and an adjustment due to the fact that we were in fact around £50 in debit for the whole year...

Needless to say, no proposal was forthcoming so we complained to the Energy Ombudsman and copied the complaint to British Gas. The Energy Ombudsman sat heroically on the fence saying that this was a commercial issue that should be resolved directly by the complainant and the energy supplier. What use is an ombudsman that directs complainants back to the organisation against which they're complaining?

In early November, however, British Gas responded by placing us back on the "2009" tariff as a "commercial gesture". That's fair enough. We couldn't complain about that. On November 10th they sent us revised statements of account taking into account the old, lower tariff, and it emerged that we were about £160 in credit. Really needing that money to go towards a new fridge/freezer, microwave oven and washing machine, we asked for a refund around November 13th, as soon as we received the new statements of account, and were told that the refund would be effected within 7 to 10 working days.

On November 30th, seeing that nothing was coming through from British Gas, we called again and were told this time that no refund would be possible without providing a meter reading. We gave electricity and gas readings there and then, and now British Gas is singing a completely different song. We're now about £6 in debit on the electricity and only £31 in credit on the gas. What was a £160 credit has turned into a £25 credit. Why was this?

The statements of account we received on November 13th took into account payments made until November 5th but only meter readings until September 5th. Why were we not asked for meter readings when asking for the refund that day? Furthermore, why were we left in the dark that no refund was forthcoming after all? Had we not called again a few days ago we would never have known that British Gas was holding back.

The whole thing has been badly dealt with by British Gas.

More about these "Price Protect" schemes, though. In actual fact, what they do is project what the cost of energy will be at the end of the protection period and start charging those rates throughout. In other words, they're not worth it. You are conned into a false sense of security, thinking that you're going to save money if prices go through the roof, yet you're paying over the odds every month.

Meanwhile, American-owned (which probably explains a few things) Centrica, the parent company of British Gas, is posting record profits of around £900m. This conjures up images of some fat cat in a cozy office sucking on a cigar with his feet up on the desk, watching reports of people dying of cold because they can't afford to heat their houses, and not realizing that his opulent lifestyle is ultimately responsible for their demise.

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