I have been involved with electricity/gas supply companies
for nine years now and would like to share some advice with the owners of
start-up businesses and those which have recently relocated or are shortly to
relocate.
Firstly, beware any company cold-calling you claiming to be Energywatch, the
‘local network supplier' or your current provider phoning to offer you a better
deal or asking for your bank details. Do not give these details out over the
phone.
New businesses, particularly start-ups, can be very naive
about energy, particularly since this is often way down their list of
priorities. This fact is often exploited by unscrupulous sales agencies
and supply companies. It is very common for this to happen approximately three
or four weeks after a business opens or starts trading. The reason for this is
that these agencies buy lists of start-up businesses and use these to cold-call
businesses. Because a business is on the list, they can exploit any
uncertainty regarding suppliers and tariffs.
I have personally organised supply contracts for existing customers who have
relocated and had a sales agency phone them saying that it is ‘null and void'
because my business has gone bust and also that EDF had also gone bust.
I have taken phone calls asking me if British Gas were still trading as ‘one of their staff' had called to say all of their gas customers had to transfer to another provider for their gas. The number left with my customer to call back turned out to be the ‘national no smoking' number.
All of the suppliers are aware of this but are not doing enough to stop it. In
same cases I believe that they are encouraging or at best ‘turning a blind eye'
to these practices. Many of these practices have been highlighted on BBC's Watchdog.
Once a new business goes into directories, they will be plagued by cold
telephone callers so be very careful who you trust. Use personal
recommendations or known and trusted suppliers from someone is prepared to
visit you. Phone a supplier and ask them to send a representative to see you or
else phone a broker and ask them to visit you in person. It would be very
difficult to assess the energy usages and needs of a business from an office
300 miles away, and even more difficult from overseas.
Do not agree to a supply contract over the phone without having first had the
opportunity to see the rates in writing and check the terms and conditions.
Business electricity contracts can be up to five years long and it is
unfortunately common for the advisor to neglect to inform the customer of this
information. Customers phoning their present supplier may be offered a ‘reduced
or discounted rate' yet this rate may be much higher than those available
elsewhere.
It is also common for the written terms and conditions to be sent out many days
or weeks later, long after any ‘cooling off period' has expired.
Previous articles have highlighted contractual issues relating to business
energy and ‘rolling over' of customers. I believe that is time for the industry
to try and stamp out ‘dodgy practices' and start to play fair and act in the
interest of the consumer.
Electricity rates are at record high levels but at the
moment business customers are having unnecessary restrictions placed upon them
trying to get the best deal for their business.
John Lewins is director of utilities
brokers and consultants Phoenix Energy (UK) Ltd. For more information see www.phoenixenergy.co.uk
