Sunday, July 04, 2010

A bit of a racket.

My electrical supplier is Scottish and Southern Energy. (This company came to be after a merger between Scottish Hydro Electric and Southern Electric. Operations appear to have been fully merged, but both brands are still used, presumably due to petty intra-Britain nationalism, so you get your bill from Scottish Hydro if you live in Scotland and Southern Electric if you are in England). I pay by direct debit. I had set up a direct debit to pay £40 a month when I moved into the flat, and up until now that seems to have covered my electrical usage.

Yesterday, however, I received my latest electricity bill. It stated that my account was £110 in debit, and that therefore my payments were to be increased from £40 to £58 a month in future to make up for this. I was puzzled by this, as my previous bill had shown the account at approximately zero and I had spent a significant time out of the UK during that period with all my electrical devices turned off. It was thus barely credible that I was using 70% more electricity than last year. Therefore, I examined the bill more carefully.

The bill was not based on a recent meter reading, but instead was based on an "estimate". I went and read the meter myself, and actual usage was a good deal less than the estimate. As far as I can tell, lacking an actual reading Scottish and Southern simply made something up on the assumption that I was using more electricity than I had done previously. Having done that, they used this entirely made up number to justify increasing my monthly payments.

I called the customer service number on my bill, and I was interrupted perhaps a quarter of the way into describing the situation, and the nice Scottish lady on the other end of the phone asked me to simply tell her the correct reading and she would fix it, which she did. My direct debit payments were switched back to £40 a month. I was slightly concerned, however, by the extent to which she seemed to understand the problem before I even explained it to her. It's almost as if it happens a lot.

I would be intrigued to know what would have happened had I not done this. When the meter was read, would my payments be reduced to move that (now massively in credit) account back towards zero, or would the credit balance be allowed to continue increasing as the debits continued to exceed the actual cost of usage? If so, this is a nice little way for the company to get its customers to fund its working capital requirement for it.


Rob Fisher said...

I had a very similar experience with a gas bill a year or so ago. Once could be a mistake...

Stitch's Master said...

If you become significantly in credit, they'll either adjust the monthly payments down or you can request the sum be sent to you as a cheque.

Michael said...

That's certainly how it is supposed to work and it's fine if it does, but the issue here is that the company put the monthly payments up without any solid reason to do so: ie an actual meter reading. Would they ever lower the payments without a meter reading? If not, there is something wrong with their honesty. If so, there is something wrong with their competence. Either way it is not impressive.

One will always get one's money back from the company eventually, but if the company likes to hoard its customer's money in order to get an interest free loan by making all its mistakes and "estimates" in the same direction, this is wrong.

Mike Roberts said...

Interesting story... It realy makes you wonder what are they doing.

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