Tips before you Switch: Utilities Disputes
Free and independent complaints service, Utilities Disputes, received 105 complaints about switching energy companies last year, mostly about unexpected fees.
"It’s your choice which energy company you sign up with, and it’s your choice if you want to switch," says Utilities Disputes Commissioner, Nanette Moreau. "However, we encourage you to take a moment and ask some questions before you switch, because sometimes the new deal doesn’t go to plan."
"Switching involves ending one contract and agreeing to another," says Ms Moreau. "Over the years, we’ve received many complaints about unexpected fees after a switch. For example, a business received a $425.50 early termination fee having had no idea their previous two-year contract had auto-renewed." The fee was removed after they brought the case to Utilities Disputes.
Ms Moreau says complaints also arise because new bills are higher than expected. "Sometimes there is a misunderstanding or a mix up. It’s important to know you can always ask a question or make a complaint to your company. And if it’s not sorted, contact Utilities Disputes. We’re here to help."
Last year, Utilities Disputes received 6,520 complaints and enquiries from energy customers. Billing was the most common issue followed by customer service, meter issues, disconnection and supply.
Utilities Disputes: Tips before you switch
2. Ask both the new and current company to explain the plan, including: Is this a fixed term contract? How long is it for? Is there a fee for breaking the contract? Do you have a plan or payment options that would suit me better?
If you’ve switched companies and it hasn’t worked out as expected, make a complaint to your company. If it’s not sorted, get in touch with Utilities Disputes: 0800 22 33 40
Complaint case studies
$425.50 termination fee, unfair Case 65546 Business XYZ switched electricity companies and recieved a $425.50 early termination fee from their previous company. Their two-year fixed term contract had auto-renewed before the switch. Business XYZ said they had no idea about the auto-renewel, and it was unfair, as the company could fix the contract for as long as it wishes. They complained to Utilities Disputes. Outcome: The Commissioner found it was likely the customer was informed, when they signed up to the contract, about the auto-renewel clause. However, it was unfair under the Fair Trading Act, as it created a significant imbalance between the parties’ rights and obligations. The $425.50 fee was removed. Before you switch, check your contract terms with both companies and ask about fees See the case note
Cheaper, quoted rates not applied Case 31020 Mr D switched electricity companies because of specific, cheaper rates quoted to him - but after he switched, his bills were higher than he expected. The company took a long time to respond to Mr D’s complaint. They apologised, agreed the quoted rates hadn’t been applied, and offered to credit Mr D $561.33 - the difference between the rates quoted and charged over six months, and a $250 customer service payment. Mr D rejected the offer and complained to Utilities Disputes. Outcome: The Commissioner found the company responded poorly to Mr D’s complaint, but their offer to credit Mr D’s account with $561.33 was reasonable. Before you switch, ask your new company to confirm the details in writing and check your bills See the case note