Crackdown on energy suppliers' doorstep selling tactics

18th January 2010

New rules governing the doorstep selling of energy kick in today. Anyone sold a new energy plan on the doorstep, in the high street or even in a shop or store must now be given a written quote before the sale can go through. 

But while consumers will get greater protection, they must still be on their guard warns uSwitch.com, the independent price comparison and switching service.

Today's move is in response to growing concerns over doorstep selling and particularly the fact that many consumers end up on a worse deal after speaking to an energy company salesman. According to uSwitch.com research almost 7 million UK households have taken out an energy plan through a direct salesman, but less than a quarter of these believe they got a good deal.

The new system of providing written quotes means that consumers will have proof of the deal they have been offered. But, importantly, the onus will still be on consumers to check for themselves whether it is the best plan they could be on.  

Ann Robinson, Director of Consumer Policy at uSwitch.com, says: "This new rule is not about making sure consumers get the best deal, or even a better deal. It's about making sure they have written proof of what they've been offered. It is then down to them to take this information and check for themselves whether they will be better off or not.

"The key thing is that consumers understand that the quote is not a guarantee that they will be saving money. Direct salesmen are not obliged to tell people about their company's most competitive plans. These tend to be online and are around £300 a year cheaper than standard plans so consumers signing up with a salesman without comparing first could still lose out.

"Over a third of people think that energy salesmen don't present them with enough information to make an informed decision while almost half  don't like the fact that the seller only represents one energy supplier. The new quotation system doesn't tackle these issues, but it does mean consumers can protect themselves by taking the quotes and comparing prices before signing on the dotted line."

As well as the requirement for written quotes, Ofgem is also increasing the threshold for debt blocking for prepayment meter (PPM) customers from £100 to £200. This means that those with a debt on their meter of up to £200 could now switch to a better deal opening up the opportunity for them to save money. The regulator has also brought in new rules on SME energy, but has backed off banning suppliers from rolling SME contracts over.

Energy direct selling - protect yourself checklist:

1. Make sure you know what company the salesperson is representing
2. What type of plans are on offer - can they tell you about their company's cheapest online plans?
3. Before telling you how much money you can save have they asked you the following:
    a. Which supplier and what plan are you currently on
    b. How do you like to pay for your energy - prepayment meter, cash or cheque or monthly direct debit
    c. Where you live
    d. Your energy consumption, monthly spend or type of property, number of rooms and people?
4. Have they given you a full quote telling you what your new annual bill size would be so that you can compare?
5. What is the value of any additional incentives, such as shopping vouchers, and how and when do you qualify for them?
6. Have these been factored into the annual bill size? - they shouldn't be
7. If you've opted for dual fuel (taking both gas and electricity from the same supplier) and to pay by direct debit have they factored in the discounts you should get?
8. Does the plan carry a standing charge?
9. Are there any exit penalties?
10. Make a note of the salesperson's name and ID number - you can contact them if you decide to go ahead after doing your research, but you also have a point of reference in case there are any problems.

Useful links:

Gas and electricity bill complaints

Claims Financial