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Dance school pirouettes its way out of EON energy debt

Small business dance school

Written By Toni

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April 29, 2024

Imagine. You’re running a community-based small business. Your doors are only open for 15 hours a week.

Then one day, a bill drops through your letter box that sends your world into a spin!

Spiralling into Debt

This is the situation a part-time dance teacher running a local dance school for young people in the West Midlands found herself in. When EON issued her a bill for £95,000…for one month’s electricity!

After 6 years of running the business and paying an approximate monthly payment of £200 for electricity, she insisted there was no possibility that a small business could now rack up this amount of energy debt. Unfortunately for her, EON representatives disagreed. 

Finding herself unable to progress any further with the dispute, she eventually contacted This Is Money’s consumer expert, Helen Crane. A chain of events was identified that may have been the catalyst of this astronomical bill being generated. 

The Opening Number

The teacher first took over the property serviced by Npower in 2017. It was already installed with a dual-rate electricity meter, and as part of the energy company’s customer service, NPower sent a representative to read the meter when necessary. However, after switching to new energy providers, EON in 2019; she was then told that this service would no longer be provided.

As her energy bills remained stable for some time; it led to the teacher being unaware of the importance of learning to use this type of meter properly.

The cost of this mistake soon became apparent however when her electricity bills began to soar!

Dual-Rate Energy Tariffs 

A dual-rate tariff charges two different prices. This is based on whether energy is used during the day or night.

A dual-rate meter distinguishes between peak and off-peak usage and typically applies a lower price for kilowatt hours generated between 10pm and 8.30 am. Off-peak times can differ depending on energy supplier and tariff type. Therefore, it’s important to thoroughly check these details in your contract.

Most dual-rate tariffs offer a lower price for energy used during the night. This is often applied in 7 hour blocks. During these hours, prices can sometimes work out to be 50% lower than those calculated during the day. Again, this varies depending on supplier and tariff. 

Dual-rate electric tariffs are usually best suited to properties with storage or water heaters. Storage heaters heat water overnight then store it to be used the next day. To save money, it’s best to only use storage or water heaters at night when the energy costs are lower. High levels of energy consumption on the day tariff could lead to costs that are even higher than standard rate electricity prices!

Dual-Rate Meters 

Dual-rate meters can sometimes be confusing to read as there are two display types. 

Type 1 features 2 display windows. Often marked ‘normal’, the top row shows the day rate while the bottom row marked ‘low’ shows the night rate. 

Type 2 has a single display feature which shows day rate usage. To see the night rate usage; press the red button and this will switch the display screen over.

Smart meter versions are also available. These can be particularly useful for those who are less confident in taking readings themselves. They can also help to closely monitor electricity usage and eliminate generating estimated bills. 

When reading goes wrong!

When sending her own meter readings for the first time; the dance teacher read the wrong display by mistake. This resulted in a £4000 bill! No longer feeling confident in reading the meter herself, she stopped submitting readings altogether and began receiving estimated ones instead.

But it wasn’t until the end of 2023 that her energy billing problems really began! After an EON took her meter readings in person last November; she later received a bill for £195,196!

Although arguing against it, she was still told to keep paying the bill. This was impossible considering the excessive amount she was being charged. After being transferred to another department; they calculated an even larger amount of £95,423! Even more worryingly, every EON rep insisted that the meter readings matched the figure she was being charged!

Eon only finally agreed to investigate after the customer insisted the figures were incorrect. This resulted in the energy company blaming the customer’s previously incorrect readings for the bill amount. She was also told it was her responsibility to prove that the bill was wrong! 

It pays to complain!

At this point Helen Crane stepped in; contacting Eon on the dance teacher’s behalf. She arranged for the energy company to teach the customer how to read her dual meter properly. Eon then requested meter readings every day for a week. A smart meter was eventually fitted at the end of December.

It was hoped that these new measures would resolve the matter. However, EON sent another bill stating that she still owed £5000 and attempted to set up a £2000 monthly direct debit. 

The teacher feared she would have to close the school down if these monthly amounts were confirmed to be correct. After further negotiations, the owner was finally able to secure a new fixed energy deal. As a result of this, her monthly bill was reduced back to the original amount of approximately £200! 

When things don’t add up!

The reason for the huge errors in this bill is still not completely clear. However, Helen Crane believes these kinds of mistakes happen when meter readings and estimated figures are incorrectly entered into energy company billing systems.

Taking this into account, it becomes difficult to understand how EON could then put the blame entirely on the customer? After all, for much of the disputed time, the customer was receiving bills that had been estimated by the energy company themselves!

What does Eon say? 

An EON spokesperson said,

We’re glad to have resolved the issue for [this customer] and that she is now seeing the real benefits of having a smart meter in her property. We would always encourage customers to get in touch with us to resolve any issues and to find out what support we can offer.’ 

Nice words. But isn’t it a shame that the customer had to enlist the help of a consumer expert to fight on her behalf before she was eventually believed…and before her bill was finally quashed? It also raises the question – if this is just one case that has come to light; then how many more are out there that we remain unaware of?! 

What can we learn from this?

There are some really important points highlighted in this particular story that we could all learn from! 

  1. It really is important to fully understand your tariff and how your meter works! Particularly if you’ve recently moved into a new domestic or commercial property; taken over a tariff that you didn’t set up yourself or if your energy company requires you to submit your own readings.
  2. If you believe your bill is wrong – contest it! And continue to contest it until you get a satisfactory outcome! Like the customer in this story – if you feel that you need some consumer expert advice, don’t be afraid to ask for it. It could completely turn the situation around for you!

When the wrong price is right!

Luckily for the dancing school, this astronomical bill was incorrect and could be rectified. But for some small businesses; the real cost of today’s electricity has caused them to go out of business!

At the end of February; a butcher’s shop in Newark was forced to close its doors after 134 years of trading! Although they had seen a slight reduction in their energy bills, they were still 150% more than in the 18 months previously – rising from £600 to £3,000 a month! A fall in midweek custom caused by the Cost-of-Living-Crisis was the final nail in the business’s coffin.

Tom Blakemore of G.H. Porter Provision’s left a note on the business’s door saying that ‘with great sadness’ they had been forced to close because they had ‘simply run out of money.’ 

Unfortunately, this is a story sadly being repeated all over Britain’s highstreets.

IEG – Bringing down the curtain on small business energy debt

Here at IEG, we can help change this narrative by creating your small business a renewable energy package that reduces your reliance on Grid energy usage and protects you from rising energy price caps. Installing solar panels and a battery storage system on your premises means that you can generate your own source of clean, fossil fuel-free energy that can be used immediately or stored for later use. And because it’s free; it ensures that all financial profits you make from these long term energy savings can be invested back in to your business! Not into paying energy bills!

Contact IEG today – we can help you to keep your small business generating for years to come!

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