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Gas supplier scams

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Joined: 09 Apr 2006
Posts: 30

PostPosted: Sat Oct 18, 2008 3:08 pm    Post subject: Gas supplier scams  Reply with quote

There is increasing concern generally about the cost of home energy, rising costs of this, and ways to minimize consumers' home energy bills. Although most of the concern is about the unit costs of energy and the failure of the suppliers to lower their prices although oil prices have fallen, there are some other issues which suppliers continuously now use to increase their billing amounts. These or variants of them are now used by all privatized utility suppliers. However, the worst examples seem to be with the tricks of the privatized Gas suppliers, and their failure to obey what seems to be established UK law specifically applicable to the supply of gas. Some of these tricks it seems are resulting in additional erroneous costs to consumers. With energy companies being accused of making large profits at the expense of consumers, using clandestine devices to further rip-off consumers is a hot topic. Gas bills are more complicated to calculate than most other bills, and so many consumers have some difficulty understanding when they are being ripped-off.

The first problem is with the use of the so-called "Correction Factor". This seems to be a recurring problem now with most Gas suppliers, who have ceased to use this as originally intended in law in the calculation of Gas consumption in terms of actual quantity of power delivered. Firstly many suppliers are using the Correction Factor on their bills wrongly to increase the stated volume of gas consumed. This is completely erroneous.

The Correction Factor (CF) was originally conceived to take account of differences and variations in temperature and atmospheric pressure at a particular metered site, and with weather and Seasonal variations, in computing the true quantity of power in kWhrs delivered to the consumer. It never affected the supposed volume of gas delivered. Yet many suppliers are now using it in their billing to increase the volume of gas supposedly delivered. This is completely erroneous and misrepresentative. It could, even if applied as originally intended, change only the notional quantity of power delivered, never the measured volume. Further, most gas suppliers are now using a blanket figure for the "Correction Factor" on all their bills to all consumers which is the same value and does not take any account of the actual variations with altitude of a consumer's site location or prevalent temperature, nor of seasonal and weather variations in temperature and pressure. This is resulting in continuous errors in bills. These errors can result in prices significantly above what the equitable price should be. If specific measurements are not taken at consumer's sites, and if the same Correction Factor is used all the time, regardless of any changes in temperature and pressure over the year and with any changing weather conditions, then the purpose of the CF is being circumvented. It is not even possible to draw the conclusion that this would not matter because over time the errors would cancel out, since for example the altitude of a consumer's site and any prevalent temperature, or the actual location of a gas meter, will give a continuous error if the same constant "Correction Factor" is being used for all customers. If a gas supplier uses the same "Correction Factor" for all consumers with no variation for site differences, altitude and changing weather conditions etc. then this factor is not "correcting" for anything. Rather then correcting for any error in the measurement of the quantity of power delivered it is solely increasing the supposed number of kWhrs delivered, by the continuous factor used!  It becomes then therefore just a device for increasing the price charged, which is what privatized gas suppliers are doing. Gas meters are normally calibrated in volume measured at STP; the number of kWhrs supposedly delivered will be claimed to be higher using a "constant" correction factor if a gas meter is situated indoors than if it is situated outside in the ambient temperature (particularly in the winter), since due to a higher temperature in a centrally heated house the gas will expand. This will give a continuous error of excess in the power being charged for. Any "Correction Factor" used should thus take account of that as one of the variables on each particular consumer site, if the amount charged is to be equitable. This is not being done in any way, and it seems that all gas companies now since privatization are using a constant "Correction Factor" for all their customers, which is thus not a true Correction Factor at all, but has become purely a constant "increase the bill factor"?

The best temporary solution to part of this continuous overcharging for erroneous quantity of power delivered, where a meter is fitted indoors in a centrally-heated house, is to have the meter moved onto the outside wall. It is also important to fit it on the most North-facing wall. (If the meter is not on the most North-facing wall then it should be moved to a North-facing wall.) This will immediately give a significant reduction in the gas bill throughout the year. It may be possible to insist that the gas supplier pays for this as one component in reducing their continuous kWhr billing errors, and their flouting of the laws relating to the supply of gas.

The second error which is widespread if not almost ubiquitous, is the wrong use of so-called Calorific Value (CV). The CV is supposed to be used to adjust for the energy actually present in the gas delivered, that is at the time delivered. This is because gas varies in its supply and the amount of energy available in it as delivered to the consumer is not always the same. The correct CV is therefore supposed to be applied at the time of billing for the gas actually supplied during the period of the bill. This is not being done. What gas suppliers are doing is to use a daily rate fed to them from Transco or National Grid for all bills produced on that day!  That is incorrect because that is not the CV of the gas delivered to the consumer as much a 3 months earlier and up to the billing date, and it usually will be different; it can be significantly different and can result in a higher price than is appropriate and equitable, because it is the CV being provided by Transco or National Grid on the day of billing - not at the time of the supply of gas to the customer. The main reason for these errors is the wrong way the privatized gas suppliers' IT systems have been configured to produce gas bills.

In addition, if there is an error in meter reading or an estimated reading has been used to increase the billable price (most of all when there is a price increase without reading the meter), and if this over-charge is disputed by the consumer and the supplier produces a new corrected bill, they ubiquitously now use the current daily CV rate fed to them, again on the day of compiling the new bill, by then perhaps relating to the supply of gas in a period 4 or 5 months previously. In fact where this takes place the CV used on the replacement bill will usually not even be the same as was used on the erroneous bill being replaced! This leads to even greater errors, and the main reason again is that the gas suppliers' IT systems are wrongly programmed to do this and cannot take account of their legal obligations.

There were laws passed by Parliament which govern these things, to ensure that the consumer got value for money in the energy value of the gas delivered to them. However, since privatization these aspects of the laws governing the supply of power in the form of gas seem to have been abused by the privatized entities, and the regulators have done nothing to censure them. These errors in overcharging contribute to the obscene profits being made by the energy companies, by ripping-off consumers.

One last point is that gas companies like all other privatized utility companies have at least one other trick up their sleeves. They all now ensure that they time price increases not to be in phase with actual meter readings. They then use tricks to increase the charges to the consumer inequitably. Consumers need to be aware of these tricks and need to contest them immediately. For example, gas companies deliberately choose to increase their price usually just long enough after the heaviest consumption period for their advantage, and then interpolate linearly in their billing, so as to overcharge unwary consumers. What they do is to deliberately choose to increase their price during a period in which they know the meter will not be read. To give a typical example, they will bill for a Feb, Mar, Apr quarter, when consumption of gas due to Winter temperatures has been higher in Feb and Mar. They will increase the price perhaps in March and then interpolate linearly over the period Feb, Mar, Apr. Due to the fact that after March consumption tends to fall as the weather becomes less cold they gain in a supposedly increased consumption of gas at the higher price by this erroneous linear estimate. Over the whole country and all gas consumers this trick results in millions of pounds of extra profit from ripped-off consumers, if the customer is not aware of this trick and does not record their own meter reading regularly and contest this rip-off immediately it is billed to them on this basis. The key thing is that consumers must take a meter reading as soon as the utility informs them of a price increase. (Even this can be difficult now, since some, for example Water suppliers, do not even inform their customers in advance now of a price increase, to ensure that they cannot record their meter reading at the time of the price increase!) The only safe thing therefore is to read your meter regularly each month and note this. Then when there is a price increase you can check the calculations accurately and contest an overcharged estimate.

Ofcom are ineffectual
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