Beware this common trap for Electricity customers

When Asmar, 72, got to the end of her discounted two-year electricity contract, her provider automatically moved her off a 12% discount onto a plan with a 7% discount and informed her she was now subject to a new two-year contract.

Sadly, it’s a common practice. Electricity retailers often revert customers to an inferior discount once their contract expires, and sometimes they don’t even bother to tell you.

It is not uncommon to learn you’re now on a new contract without having had a proper chance to consider it, or to find yourself reverted to a plan with no discount at all.

Consumer groups have for years highlighted these practices as being unfair.

And in Queensland, the energy regulator is now moving to outlaw this practice, as recently reported here:

“In its draft decision [on March 21],” The Courier Mail reported last week, “the Queensland Competition Authority said it would amend the Electricity Code to require power retailers to remind consumers that their contract was due to expire between 20 and 40 days in advance and provide information on what deals were available.”

But in other states the practice remains rife. So it’s up to consumers for the time being to be vigilant. Before you sign onto an offer, ask the retailer what your new discount will be once the offer expires, and whether you will be free to move if you want to shop around. Put a note in your diary so you know when to shop around again.

For the record, the FiftyUp Club’s special offers on Electricity do not revert to a zero discount, and do not lock you into a contract period at all – let alone after your discount expires.

Has your retailer taken advantage of you when your electricity contract expired? 

Click here to have your say in the FiftyUp Club forum.