As a columnist for timesonline.co.uk Patrick Hosking has written an article which warns consumers of gas and electricity to be aware of automatically rolled over contracts whereby suppliers suggest that the contract will be rolled over and continued based on the same terms – however, this is not always the case and consumers could find that their energy prices have ‘automatically’ been increased.

For purposes of an example, the article relates to an individual who is a volunteer treasurer for his local village hall, who happened to receive a letter from energy supplier British Gas. The letter itself was not unusual, advising that the village hall’s annual gas supply contract was due to expire and continued by suggesting that it would simply be rolled over on the same terms – British Gas was offering to renew the contract automatically.

However, it was apparent that the letter nowhere mentioned any kind of a price rise despite speaking ambiguously of new prices. It was at the very end of the letter that the rollover price per kilowatt hour was listed but there was no mention of the existing price to compare.

Digging out an old invoice it was then discovered that British Gas were attempting to impose a 42% price increase on the village hall’s gas supply – with that information to hand British Gas were called, but extraordinarily a much lower new tariff was offered almost immediately – just 0.4% higher than the existing price.

So, having had such a conversation with the call centre worker who was not dispelled by the caller, it seems as if British Gas has a policy to see what price they can actually get away with, then at the first sign of customer resistance, they can backtrack and offer a far more reasonable deal.

Coincidently, another letter was received from British Gas a few weeks later regarding the village hall’s electricity supply – and as above, after comparing the rate with an old invoice, British Gas had in fact inflicted a 63% price rise this time. But, upon calling British Gas again, the call centre operative proposed a new tariff which meant an increase of only 1.6%.

It seems that those customers who are too trusting, too busy or too idle to challenge these companies, play right into the suppliers hands – by finding themselves on much higher energy tariffs that have automatically been rolled over into a new agreement.

A large number of British Gas’s 600,000 small-business customers are on such pricing regimes however the supplier declined to confirm just how many of those accept their new terms without question, and are therefore oblivious of the fact that they might have secured a better rate by simply making a phone call.

In response to the example case British Gas, and Centrica, its parent company, said that it is “absolutely dumbfounded” by the individual’s experience and that the reduction he was offered when he challenged the price increase was “unheard of”

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Source: timesonline.co.uk

Tags: business electricity prices, gas business prices

This entry was posted on Thursday, January 7th, 2010 at 11:53 am and is filed under energy-news. You can follow any responses to this entry through the RSS 2.0 feed. Both comments and pings are currently closed.