Price gouging is something that people in this economy are all too familiar with. Companies in all sorts of industries can increase their prices in response to economic or cultural demand, costing the average consumer significantly.
Photo by Burak The Weekender: https://www.pexels.com/photo/lighted-light-bulb-in-selective-focus-photography-45072/What is price gouging?
A price gouge is often enacted due to disruptions in supply (inflating beyond the corresponding price increase), national emergencies and other major events, such as the energy crisis. In the UK, energy companies price gouging is supposed to be legally protected against, with things like the Competition Act 1998 and the ever-evolving Energy Price Cap. However, this doesn’t mean that you shouldn’t keep an eye out for more reputable business gas suppliers or electricity companies, to avoid improper practices that can still pop up.
This article will offer some insights into how you can avoid being “price gouged” (even if not by legal definition), spotting unfair pricing practices. Predatory practices can often slip through the cracks, so it’s important to be vigilant.
Understand your tariff and its rules
Understanding your energy tariff is important to determining whether you’re being overcharged or not.
-
- Fixed tariffs. These tariffs mean your unit cost and standing charges are locked in for a specified period. Prices can only be increased in response to increased VAT from the government.
- Variable tariffs. Standard variable tariffs (SVTs) mean unit prices can change. These tariffs should be set according to the price caps, according to Ofgem, limiting the maximum amount any supplier can charge you for each unit of energy and standing charges. The price cap is reviewed and updated every three months, so it’s important to stay aware of it in relation to your energy bills.
Pay attention to your energy bills & any updates
It’s important to stay up to date on any changes to your energy bills or contract. It’s your energy supplier’s responsibility to alert you with reasonable notice before any price increases take place, with the rules of different tariff policies kept in mind. If your prices go up and you haven’t been alerted, you have every right to contact them and defend yourself.
Things to look out for include:
- Direct debit payments increasing suddenly. If your bill seems to randomly jump up with no prior warning or information, then you should get in touch with them. They might be bumping up your energy bills based on what they “think” you’re using.
- Estimated bills. In a similar vein, your supplier might bill you based on estimated usage. These readings could easily be inaccurate or artificially high. It’s advisable to take regular meter readings to ensure accuracy.
- Back-billing of old energy use. Suppliers should not be able to charge you for energy you used over 12 months ago. If they try to, refuse, and question it.
General awareness practices
While price gouging per unit is uncommon, there are plenty of ways that companies will try to overcharge you. Some practices to keep in mind throughout the transaction include;
- A fixed-term contract ending will move you to an SVT, which could be inflated with a “deemed” or “out-of-contract” rate, so make sure to keep an eye on contract length etc.
- Make sure to properly break down your contract for unit rate, standing charge and any other fees. Some contracts will be written with confusing you as a primary goal.
- A supplier shouldn’t charge you an exit fee if you’re moving house, so keep an eye out for this and challenge it if it comes up.
Take action and protect your business
Making standard complaints and checking your bills should ideally be enough to protect you. However, if your case isn’t easily solved, you can elevate to an Energy Ombudsman – an independent body that reviews cases for fair decision-making. And, of course, the most important thing is to simply work with a reputable business energy supplier from the jump off!
#Spot #Price #Gouging #Business #Energy #Companies #Daily #Business