It’s disturbing to see companies make big changes to their contracts without getting customer consent. Direct Energy is the latest to try this tactic.
The British-owned firm is sending letters to customers who rent water heaters, thanking them for their loyalty and offering a few service enhancements. Many people don’t read beyond the first few paragraphs.
Then, comes the kicker. Direct Energy says customers have to accept new contracts unless they call to opt out by April 2.
The new contract stops clients from buying or renting water heaters from other suppliers unless they pay buyout fees of $200 to $1,000 or more. The current contract has no such fees.
Direct Energy wants to protect its declining market share from door-to-door competition. It also stands to profit from imposing inflated buyout fees on older tanks.
Customers who accept the new contract will get a 24-hour service guarantee and inflation protection on rates. But I don’t think that’s enough to offset the new exit charges.
Many people dislike having major contract changes forced on them without their express consent. Negative option billing is banned in Ontario. This seems to be skirting the line.
Also, the opt-out date is too close. Direct Energy’s letters were mailed out only last week. Shouldn’t it give customers at least 60 days’ notice to react?
I’ve decided to buy out my 12-year-old rented water heater. (The cost is only $131, less than a year’s worth of rental fees.) And when it stops working, I’ll purchase a new unit.
No more renting for me, I said in a follow-up column. If you’re looking for a reason to stop renting, which is convenient but costly, Direct Energy’s conduct has given you one.
Seize the opportunity to break free.