Law Talk: Ding dong trouble
It starts with the doorbell.
Waiting at the front stoop is a man, clipboard in hand, offering “a better deal” on gas or electricity — a fixed price for the next five years. He works for what is commonly called a hydro/gas re-biller. And while his offer sounds tempting, there are some things you should know before you sign up.
Hydro and gas re-billing companies emerged after the energy market was fully de-regulated in 2002. They purchase gas from generators and wholesalers and re-sell it to consumers in multi-year, fixed priced contracts.
The companies are known for their aggressive, misleading and sometimes-unlawful marketing tactics.
However, re-billers are regulated by the Ontario Energy Board Act which states a re-biller cannot make a false, misleading or deceptive statements. So if one lands on your doorstep, here are some things you should know.
Re-billers often say they are “from the hydro company,” though you can be sure they do not work for London Hydro.
Re-billers might also ask to see your bills, adding that they are checking to make sure everyone in the neighbourhood is “paying the proper rate.” But they have no right to see your bill, no matter how persuasive they may seem. If they make it seem like the plan they offer is necessary, it's not.
Remember, if you feel pressured, at any point you can ask a re-biller to leave.
A re-biller might also say that the London Hydro rate is about to raise drastically, but they have no way of knowing what will happen to energy prices.
In fact, according to the website www.energyshop.com, the hydro rates offered by re-billers at the end of October 2009 ranged from 7.49 cents/kWh to 7.99 cents/kWh. At the same time, London Hydro is charging 5.7 cents/kWh for the first 600kw used and 6.7 cents/kWh after.
Even if London Hydro's rates climb past the re-billers, on top of any locked in rate will be standard rates for electricity supply costs, debt retirement and operation charges. Plus, the Ontario Energy Board has said that any re-billers customers are not eligible for any legislated caps on electricity rates.
Finally, re-billers do not offer free trials, so anything you sign may enter you into a multi-year agreement.
If you do sign up, and you want out, there are some options.
The Ontario Energy Board Act and its regulations require that re-billers call and confirm a sale within 10 days of visiting your house. If you say no when they call, you have no obligations to the company. Beware, though, sometimes the call will just be a message instructing you to, “just say yes.”
If you say yes, the company still needs to send a written copy of the contract within 40 days. If you do not receive one, anything you signed ceases to have effect and you cannot be charged any cancellation fees or penalties.
When you receive the contract, make sure the following Ontario Energy Board Act requirements are included.
The contract should have your name and address as well as all the contact information of the re-biller, plus its license number. The person who signed the contract for the re-biller should be identified, as should the date the contract begins and the date the service is supposed to start.
All circumstance that might delay service should be outlined. Provisions, written in 12-point bold type, affirming the 40-day written contract and 60-year reaffirmation stipulations described above should be included. Also there should be a statement that the consumer has one year to cancel the contract if it does not meet these standards.
The heading “Consumer's Rights” needs to be in 12-point bold font.
There also needs to be a statement outlining that the consumer is not contracting with the local electricity or gas distributor.
Naturally, the contract should state price to be paid for gas, in cubic metres, and electricity, per kilowatt hour, should be included. In the case of electricity, the contract must also include the price of the service for the consumer if you used the local distributor, with a line for your signature next to it. This should be accompanied by the terms of payment.
There should be a statement about the how the consumer or re-biller may terminate the contract. Also, whether the contract applies only to specified premises and any terms or conditions in relation to making the contract applicable to other premises should be included.
Finally, there should be a description of how you can make a complaint or ask the retailer a question and the contact information of the Ontario Energy Board's Customer Service centre.
If the terms of the contract do not comply with the provision above, then you have one year to back out.
You should also know that the provincial government has proposed a new law to promote fair business practices throughout this industry: The Energy Consumer Protection Act would ban the high cancellation fees and hidden contract terms that can come with an energy re-biller contract. But for now, any complaints can be directed to the Ontario Energy Boart at: 1-877-632-2727 or online at www.oeb.gov.on.ca.
This column provides legal information only and is produced by the students of Community Legal Services and Pro Bono Students Canada (UWO). If you need legal advice please contact a lawyer, community legal clinic or the Lawyer Referral Service at 1-900-565-4LRS. You can contact Community Legal Services at 519-661-3352 to book an appointment to discuss your legal issue or mediation services. Fanshawe College students may also book an appointment to attend our outreach clinic at the college. Please call us at 519-661-3352 with any inquires or to book an appointment.
Waiting at the front stoop is a man, clipboard in hand, offering “a better deal” on gas or electricity — a fixed price for the next five years. He works for what is commonly called a hydro/gas re-biller. And while his offer sounds tempting, there are some things you should know before you sign up.
Hydro and gas re-billing companies emerged after the energy market was fully de-regulated in 2002. They purchase gas from generators and wholesalers and re-sell it to consumers in multi-year, fixed priced contracts.
The companies are known for their aggressive, misleading and sometimes-unlawful marketing tactics.
However, re-billers are regulated by the Ontario Energy Board Act which states a re-biller cannot make a false, misleading or deceptive statements. So if one lands on your doorstep, here are some things you should know.
Re-billers often say they are “from the hydro company,” though you can be sure they do not work for London Hydro.
Re-billers might also ask to see your bills, adding that they are checking to make sure everyone in the neighbourhood is “paying the proper rate.” But they have no right to see your bill, no matter how persuasive they may seem. If they make it seem like the plan they offer is necessary, it's not.
Remember, if you feel pressured, at any point you can ask a re-biller to leave.
A re-biller might also say that the London Hydro rate is about to raise drastically, but they have no way of knowing what will happen to energy prices.
In fact, according to the website www.energyshop.com, the hydro rates offered by re-billers at the end of October 2009 ranged from 7.49 cents/kWh to 7.99 cents/kWh. At the same time, London Hydro is charging 5.7 cents/kWh for the first 600kw used and 6.7 cents/kWh after.
Even if London Hydro's rates climb past the re-billers, on top of any locked in rate will be standard rates for electricity supply costs, debt retirement and operation charges. Plus, the Ontario Energy Board has said that any re-billers customers are not eligible for any legislated caps on electricity rates.
Finally, re-billers do not offer free trials, so anything you sign may enter you into a multi-year agreement.
If you do sign up, and you want out, there are some options.
The Ontario Energy Board Act and its regulations require that re-billers call and confirm a sale within 10 days of visiting your house. If you say no when they call, you have no obligations to the company. Beware, though, sometimes the call will just be a message instructing you to, “just say yes.”
If you say yes, the company still needs to send a written copy of the contract within 40 days. If you do not receive one, anything you signed ceases to have effect and you cannot be charged any cancellation fees or penalties.
When you receive the contract, make sure the following Ontario Energy Board Act requirements are included.
The contract should have your name and address as well as all the contact information of the re-biller, plus its license number. The person who signed the contract for the re-biller should be identified, as should the date the contract begins and the date the service is supposed to start.
All circumstance that might delay service should be outlined. Provisions, written in 12-point bold type, affirming the 40-day written contract and 60-year reaffirmation stipulations described above should be included. Also there should be a statement that the consumer has one year to cancel the contract if it does not meet these standards.
The heading “Consumer's Rights” needs to be in 12-point bold font.
There also needs to be a statement outlining that the consumer is not contracting with the local electricity or gas distributor.
Naturally, the contract should state price to be paid for gas, in cubic metres, and electricity, per kilowatt hour, should be included. In the case of electricity, the contract must also include the price of the service for the consumer if you used the local distributor, with a line for your signature next to it. This should be accompanied by the terms of payment.
There should be a statement about the how the consumer or re-biller may terminate the contract. Also, whether the contract applies only to specified premises and any terms or conditions in relation to making the contract applicable to other premises should be included.
Finally, there should be a description of how you can make a complaint or ask the retailer a question and the contact information of the Ontario Energy Board's Customer Service centre.
If the terms of the contract do not comply with the provision above, then you have one year to back out.
You should also know that the provincial government has proposed a new law to promote fair business practices throughout this industry: The Energy Consumer Protection Act would ban the high cancellation fees and hidden contract terms that can come with an energy re-biller contract. But for now, any complaints can be directed to the Ontario Energy Boart at: 1-877-632-2727 or online at www.oeb.gov.on.ca.
This column provides legal information only and is produced by the students of Community Legal Services and Pro Bono Students Canada (UWO). If you need legal advice please contact a lawyer, community legal clinic or the Lawyer Referral Service at 1-900-565-4LRS. You can contact Community Legal Services at 519-661-3352 to book an appointment to discuss your legal issue or mediation services. Fanshawe College students may also book an appointment to attend our outreach clinic at the college. Please call us at 519-661-3352 with any inquires or to book an appointment.
