Tenants in a block of flats owned by Gloucester City Homes (GCH) had for many years paid for their gas heating as a communal service charge between £4 and £11 a week. But the landlord was making a large loss on this arrangement so had prepayment meters fitted to make tenants accountable for their own energy use. Sensible on the face of it; but when GCH engaged a third party, Welcome Energy, to liaise with tenants on their behalf, things started to go wrong.
The new meters had an emergency credit allowance of £10 and on a weekends operated on the misleadingly named ‘Friendly Credit’, which gave tenants unlimited access to energy from 5pm Friday to 8am Monday – Welcome Energy’s out-of-office period. The arrangement held regardless of whether there was any credit on their meter. Although this ensured tenants were not left without heat over the weekend, in practice they were regularly accumulating debt on their meters – in our client’s case £1,560.
This was all the worse because Welcome Energy at the time was charging 39p per kWh, when prices from energy companies were around 7p.
Our client contacted Severn Wye for help clearing his debt. Welcome Energy were requiring him to repay 10% of this debt every time he topped up the meter, without any discussion of affordability. This is very high; a regular energy company would only charge up to around only £10 a week depending on what the customer could afford.
When our community-based energy adviser intervened, Welcome Energy advised that they did not fall under the umbrella of the Ofgem Energy Price Cap so could set their own charges to tenants. Our adviser challenged this with Welcome Energy’s surveyor who subsequently confirmed they were looking at lowering the charge to 19p per kWh.
A welcome reduction – but not good enough. So our adviser emailed Gloucester MP Alex McIntyre who contacted each resident individually and found a large number coming forward saying they were in debt. Subsequently meetings with GCH and Welcome Energy led to a much fairer resolution; GCH agreed to write-off some of their tenants’ debt and lower the unit price they were charging.
This is just one instance of this kind of inappropriate charging and Alex McIntyre is now taking the issue to parliament – a good example of how appropriate interventions can feed up the political ladder where systemic change can happen. Severn Wye continues to broker the issue, working together with Gloucester City Homes to support tenants.
A huge thank you for holding this event – it went extremely well. GCH
A recent drop-in event we organised at the flats was well attended and encouraged others with energy debt to come forward; in all so far our advisers have supported more than 70 residents and we look forward to hearing from the MP when – we hope – changes are agreed about costings for the communal heating system.
Above: Severn Wye community-based advisers Ahmad Akram and Becca Mitchell, with colleagues from Gloucester City Homes.
It can be really daunting standing up to big organisations, especially when they set their own rules. That’s when having an energy adviser in your corner – and your MP – can make all the difference.
