Does your water heater need to be replaced?

November 19 2009 by Ellen Roseman

You have a rented water heater and you pay monthly fees on your gas bill. But Ontario’s gas utilities are no longer in the water heater rental business. Enbridge sold its portfolio to Direct Energy and Union Gas sold to Reliance Home Comfort.

Recently, new competitors are trying to grab the business away. The two legacy firms are losing market share and they’re not happy.

Direct Energy, in particular, has a strong motive to cover its assets. In 2002, it set up the Consumers’ Waterheater Income Fund, which gives investors 65 per cent of the rental revenues, while Direct Energy gets the remaining 35 per cent for life-cycle support.

“The Fund generates very stable cash flow, making it ideally suited to the income trust structure,” it says. But the share price has slipped to $3.66 from a 52-week high of $10.30.

In its latest quarterly report, the fund explains what went wrong:

The attrition rate of 3.5% increased significantly from 0.9% in the prior year due to intense competition.

The Fund and Direct Energy Marketing Limited (“DE”) have initiated a range of marketing programs aimed at informing our customer base and reducing future attrition levels.

Direct Energy has a new website, warning customers about misrepresentation by rival water heater sellers .

It uses the same slogan I use (“straight talk”) and has bought the rights to use several of my columns there.

Reliance Home Comfort has set up a new consumer website as well, and posted my latest column there.

I’m not thrilled to be a poster child for these campaigns, but I do hate the way that some rivals misrepresent themselves to make a sale and lock customers into long-term contracts with stiff exit fees. The tactic of installing new water heaters during the 10-day cooling off period also makes me crazy.

As usual, readers happily shared their views about the water heater wars and other issues involving Direct Energy, Reliance and Enbridge. Some comments appear below.

Several people asked me to explain the pros and cons of renting vs. buying your own water heater. I’m a renter (just lazy, I guess) and I’d like to hear from those who have bought their own tanks. As for tankless (another question asked by a few readers), my thumb’s down for now.

61 comments

  1. Cynthia

    Nov 19 2009

    I know at my last place the tank was a rental. It bottomed out and had to be replaced. I called right away. We had to wait 2 days for a replacement.

    I think in today’s day and age, hot water is a must. Glad this current rental is from our local hydro company. Knock on wood, it’s still good.

  2. Bylo

    Nov 20 2009

    > Consumers’ Waterheater Income Fund, which gives investors 65 per cent of the rental revenues

    > I’m a renter (just lazy, I guess) and I’d like to hear from those who have bought their own tanks.

    Do the arithmetic and you’ll soon see why the income trust can be so lucrative for investors. At $15/month to rent you pay $180 a year. If you buy instead your break-even point should be about 4 years.

    All hot water heaters come with at least a 6 year warranty. In practice they last at least twice that long. But even if they die after 6, you’ll be way ahead.

    Renting is like buying a very expensive extended warranty and then paying for it by credit card. Would you recommend that to your readers? I didn’t think so 😉

  3. PG

    Nov 20 2009

    Ellen: National Home Services showed up in our neighbourhood the day of your column. My wife says I was “rude” at the door. So I’d like to apologize and invite them back so I can do it again!!!

    And oh yes, the guy started out with the “our brochure in your Enbridge bill some months ago” bit. Don’t know what he was supposed to say next because that’s when I asked him to leave.

    In any event, we weren’t really candidates as we have owned our tank for over 7 years! It’s a 50 gal. high efficiency power vent model.

    On the bad side, it has had 2 owner-pay service calls. Once for a new igniter ($100 service + $60 part) and two years ago when it stopped working and we had to pay another $100 service to have the tech simply plug it in (after I had repeatedly done this) and it has worked ever since. Go figure!

    Both service call appointments were arranged with Direct Energy and they were here within one day the first time and 2 days the second. On the plus side, despite these two calls, we have still saved money.

    Here’s what a person looking at buying/renting is faced with today:

    New GE tank installed via say Home Depot, $1100 incl taxes
    (1 yr parts/labour warranty, additional 5 yr warranty parts).

    Rental from Direct Energy $25/mo incl taxes (bumper to bumper warranty forever but rate can increase in the future).

    So the math says your basic breakeven point is at the 4 year mark. After that, it’s the luck of your owned tank.

    Direct Energy’s website quotes the horrific price of new parts (e.g. the $672 ventor motor or the $697 gas valve) if you own a tank and need repairs. Don’t know where they’re getting these prices from, but I suspect they include one HUGE markup for them.

    Note the price of an INSTALLED new unit above! The website also talks about your time and peace of mind. And that’s the real issue!!

    When deciding on owning/renting ask yourself:

    1) In the worse case scenario, am I prepared to go without hot water for say two days? (Note that HD used to install same day if booked before noon but unsure what they do now.)

    2) How important is peace of mind/extended warranty? When you bought your last car, did you buy an extended warranty? If not, why would you want one for a much simpler water heater?

    My wife was offered a $1.50 extended warranty on a $7 audio cable yesterday at The Source. The only thing she could see going for it was it was an additional Source of revenue, or as some would say, a transfer of wealth from her to them!!

    3) Don’t count on getting service priority just because you rent – even DE doesn’t seem to bring this up on the website.

    So in summary, yes, I’m biased. We’re in the position now that if something major happens, we’ll just get a new unit.

    If you can afford the initial all-at-once capital outlay, buying just seems to make sense. But to each his own.

    After all, there’s that Income Fund to keep going!!!

  4. Kathryn

    Nov 20 2009

    I rented my hot water heater from Toronto Hydro until Toronto Hydro sold the business to Direct Energy.

    The service deteriorated to the point where I was considering a change. The original rental was ‘off the grid’ and I had to have it placed on the grid.

    The contractor that Toronto Hydro recommended was extremely unhelpful, so I looked into changing to gas.

    Direct Energy put most of their energy into upselling. It would have involved my having to take two [full] days off work for installation (one to assess, but they could not even give a half-day window and did not work evenings). I was not prepared to do that.

    Then, they gave me an inflated price to purchase a six year old water heater. Enough.

    I bought a new gas water heater & had it installed on a weekend. I am happy with my decision.

    From this experience, I learned not to deal with any energy company, if it can be avoided.

  5. second opinion mike

    Nov 23 2009

    Seems like renting a hot water tank at $20 a month for 15 years is a little expensive

    The present value of the required payments at a discount rate slightly above planned inflation suggests the water tank will cost almost $2,600.

    Based upon your reader feedback, you can buy one and get a great maintenance agreement for less than that.

  6. Jenn

    Dec 3 2009

    Would like to say that Ellen now has a facebook group come join 🙂

    http://www.facebook.com/home.php?/group.php?gid=185665570255&ref=mf

  7. Adrian

    Dec 6 2009

    This is exactly what Direct Energy (DE) was doing when the water heaters were owned by Enbridge …they use to send aggressive door to door guys to get you to switch from Enbridge to them ( DE ) !!!

    Now that some other company is doing the same to them and they are complaining all of a sudden..go figure .

  8. JRW

    Dec 12 2009

    On the matter of lease vs purchase, we lease principally because the water in our community is extremely hard and clogs up water heaters pretty quickly. We have had our (gas) heater replaced a couple of times by Direct Energy without a squawk. Leasing has proven to be the option of choice in our situation.

  9. Mike

    Dec 14 2009

    I’m dismayed and kind of stunned by all this, and I need to ensure your readers are properly warned as I’m not sure this has been done yet.

    I have seen two positive and strangely similar comments here about National Home Services—do we know these haven’t been written by company representatives?

    A salesman from that firm has come to my parents’ door. Although they are both very intelligent, assertive and capable people, they are elderly and in poor health.

    To my amazement, they not only let the salesperson into their house, they did their best to co-operate with him. They were in the midst of signing a contract with him simply because, as they told me later, somehow they’d come to the understanding that they had to, and also to get rid of him because they were so tired.

    Luckily, I came for a visit while the salesperson was there, and, I hope, before they signed anything (I’m still not sure about that yet—this all just happened).

    I had assumed the visitor was from the company that owned the water heater (so did my parents), and that he’d been called there by my parents.

    I told the man I’d call him later and asked him to leave, as my parents were clearly upset. Only then I realized he was a salesperson from National Home Service.

    The fact that he did not seem ‘pushy’, or whatever one reader here has written, is completely irrelevant. He was bothersome, very intrusive and persistent and, in my view, deceitful.

    How can some of the practices mentioned here possibly be legal? If nothing else, I believe there needs to be a huge outcry against these companies and their sales practices. At the very least, we should not tolerate them going to private homes and trying to convince the homeowners to let them in.

    I like your work and respect what you are trying to do, Ellen, but in this case I strongly believe you needed to take a much stronger stand against these practices and at least issue a much clearer warning about letting any stranger enter a private home.

  10. Mike

    Dec 14 2009

    Thanks Ellen, I’ll check that for sure and pass it on. The salesman I mentioned was from National Home Services and he was wearing a large reflective vest and jacket and ID that looked definitely like a technician from a government agency or public utility.

  11. Trevor

    Dec 19 2009

    I am very confused that so many people would rent a hot water heater from these companies. I am sure that consumers are overpaying rental fees.

    The total cost of buying a hot water heater and having it installed (I am ball parking) would be $1,000 to $1,500. But you are paying $40 a month for 10 yrs? Sounds like this is a pretty good deal for the companies.

  12. HS

    Jan 7 2010

    I sold my house in August of 2007. I contacted both Enbridge and Direct Energy well in advance to cancel my services (gas and water-heater rental respectively).

    My gas was cancelled as planned. But Direct Energy continues to charge me for the water heater rental.

    I have contacted them many times (I have at least 6 case numbers from them). The new owners have confirmed that they are also being charged for the only water heater in the house.

    Unfortunately, it is like dealing with a black hole. I contact them and they promise to get back to me within 24-48 hours. They don’t. I call back and get a new case number.

    They usually verify that the information is there and that this should be resolved soon. But nothing happens. Very frustrating. For that past few months, a collection agency has been contacting me on their behalf.

    Of course, they only charge me about $20/month. The total owed now is about $130 or so. A very negligible amount. But they keep adding on to it.

    I would be quite happy to part with several times that amount (given to a local charity), if I could be assured that they will stop this. I don’t think I should be paying in perpetuity for a water heater that I no longer have or use.

    I am a partner in a marketing firm and have been very clear in my communications with them. I also teach economics at a local community college.

    My thinking is that if they do not respond to my requests, then the same issue must be facing a lot of people (with language barriers, etc.).

    Unfortunately, the only thing that persuade companies like this is either media attention or legal action.

    I think many of your readers will be interested or may even have had a similar problem with Direct Energy.

  13. Mark N

    Jan 26 2010

    We are in the process of replacing our 12 year old rented water heater. Don’t know why it took so long for me to look at the numbers…

    Renting vs. owning is a no brainer. Cost to replace our PV unit is ~$1,200.

    Even if I financed the entire purchase with a line of credit and then directed my ~$22+GST rental payment to the LOC, I could have the thing paid off in under 6 years.

    Effort = Trip to Home Depot.

  14. fedup

    May 5 2010

    I got scammed by one of the new companies. It has been several months now but the contract did not get transferred from the old company DE to the new one. But both companies are charging me for the only hot water tank in the house. Both blame the other. Plan to cancel the new one because they have not delivered and will cancel DE later and put in my own unit.

  15. Teena

    Jun 14 2010

    I just fell into the same scam today from National Home Services, claiming to replace my water heater free of charge. After reading this page, I immediately called them up to cancel the installation appointment and cancel the contract on the same day, within an hour.

    Now I was told that I would not be charged anything since nothing was installed.

    However, can anyone who’s been through this assure me that I will not be charged for anything??

    Any response to this post of mine is greatly appreciated.

  16. LnewMan

    Sep 14 2010

    Hi Ellen,

    Is there as site/tool to compare the cost for National vs. Reliance? Someone I know was tricked by a National Home salesperson few weeks ago. Should I tell them to cancel it even though there is a heavy penalty?

  17. Cindy Ireland

    Sep 22 2010

    We just recently signed up with National and I was happy to do it. We moved into a home which had Reliance water and gas heaters. Trying to get an answer on service regarding the gas heater, was a 2 week nightmare. No one knew their ass from a hole in the ground. Their water heater, rumbled through my house. Knew if I called for service, I would get the same stupid “no one here knows a damn thing’ customer service. National was friendly, lower rental than Reliance, straight forward and hid nothing from us, including taking business away from Reliance. We questioned everything and was given answers. Nationals water heater now stands in our home, energy efficient and no rumbling!
    Goodbye Reliance and if you want to stay in business, work on your customer service skills!

  18. Cindy Ireland

    Sep 22 2010

    Oh… and what happened with the gas heater in our home, here’s Reliance’s answer.

    We will set up an appointment and call you…wait, our service guy will call you, his name is blah blah, wait, we have no service guy, wait, we will call you back, wait, we no longer rent gas heaters, wait, we no longer service our products either, wait, a representative will call you tomorrow…bottom line, we have an independent coming to look at it….

    Thanks, Reliance.

  19. Mike

    Oct 15 2010

    I was beaten by their salesman at my door.
    When I told them I was smarter than them they got verbally abusive. I tried to close my door but they were in the way. I push them so I could close my door then the guy named Habib forced my door open and started punching me. I fell to the floor and he came in to my house and started kicking me. eventually the police came and wouldn’t charge them because I had no witnesses!

  20. Luke

    Oct 25 2010

    We have had a National Home Services water heater for a little over 6 months. The agent explained to me very clearly what was going…..not once did he misrepresent himself.

    They are simply replacing non Energy Star tanks to the Energy Star. Yes, the rental is a dollar or two more, but the two months free and efficiency savings more than offsets that (plus, you also get free cleaning of the tank every 5 years).

    I did all the research beforehand and foind it was a no brainer in the end.

    As for the 15 year contract, who is ever going to consider removing the highest efficiency water heater on the market?!?!? You can buy it at any time and if you move house, the new tenants take over….this was made very clear to me.

    I have been very happy with National and just thought i would share my experience.

    I also think people are forgetting how Direct Energy \scammed\ everyone with their gas contracts. Always two sides to every story.

    I’m supporting the Canadians here…..not British-owned Direct.

  21. Matt T

    Nov 29 2010

    I applied for a job online, with National Home Services. Having no idea what they are all about. During the interview that i had the next day it became clear that something was wrong. they would not answer simple questions like ” what kind of things would i be doing” everything was kept in the dark. I reluctantly accepted the job being hard up for money not sure what it involve. scheduled to start on Monday. I did some research on line about the company and i was shocked at what i read. i was pissed off to say the least, called them up and told them where they could go still feel like i was taken though. at least i quit before i started.

  22. TL

    Feb 24 2011

    I am a witness that NHS is very professional with their approach at the door.

    In fact, I was visiting a friend earlier today and an agent knocked on her door. After explaining clearly that she was representing NHS a canadian company btw, my friend let her in to inspect the hot water tank that my friend thought (or was led to believe) was only 2 years old.

    The NHS agent honestly pointed out 2 things:

    1/ that the tank was actually manufactured in 1995!!! not just 2 yrs ago. Therefore it’s been refurbished and rented to my friend as a new tank. LIE #1

    2/ even though the agent did not ask to see her acct with Reliance home comfort,
    my friend wanted to see how much she in fact had been paying for this tank she has been renting UP TIL NOW. We all discovered that Reliance had been overcharging her.

    Now she only has a basic 40 gal tank and the NHS agent told her she would only have to pay $12.49/month+ tax for her new energy star tank from her company
    and she would get 2 months free as well and also 2 months credit for each person that she refers!!

    My friend was paying $65/3months for this tank she thought was new from Reliance for over 2 yrs now. So who’s doing the shafting??? Seems VERY CLEAR to me and my friend, it isnt NHS that is being dishonest here today.

    Thx to that agent my friend who is a widow also will not be taken by a company like Reliance any more.

    P.S. My friend almost didn’t let her in the door but we were both curious since we have never heard of NHS until today. I’m glad we heard her out firsthand and she was nothing like how some of you described here.

    She was honest and not pushy at all and answered all our questions and explained things thoroughly. Just goes to show ya that not EVERYONE AT THE DOOR is there to rip you off. Sometimes they can show you who is really ripping you off and give you something much better or at least what you deserve.

    I will recommend NHS to my friends and family just based on what I witnessed for myself today.

    I don’t usually post in these things either, but I had to speak up based on what I saw and heard take place today.

    Sorry, some of you probably had agents that are no longer with the company if they lied that much to you…hopefully you reported them at least if they lied to you!!

  23. Anna

    Apr 5 2011

    Hi, my water heating tank is already 10-15 years old. So we had to find another company.

    These two guys knocked on my door a few months ago from the National Home Service company. They checked to see if my water heating tank is new or something like that. So i guess yeah sure.

    They said they’re going to give the old water heating tank back to the Reliance company. But the Reliance company haven’t got it since almost a month and I’m guessing the National Home Service haven’t even sent it.

    The Reliance company was still costing us because they said I was still using it. I talked to both companies on the phone for almost 2 hours each. And still, the Reliance company is still charging me.

    I’m pretty frustrated right now, so what should I do?

  24. john Chow

    May 31 2011

    I purchased a used (6 yrs old) HW tank via Kijiji. I picked up the tank for $100.

    Ordered an Anode rod from Rheem via a plumbing shop for $30. Got someone to install it for me for $220 (Ouch!..I paid a bit more..but..).

    Total cost $350.

    One year passed, & I avoided paying month rental of $15 x 12 months x taxes, close to $200 already. As long as the tank is in good condition & I put a new Anode, I shouldn’t have problem for at least 5 yrs.

    I have had a long long story with National Home Service. However, a prudent & caring billing agent of NHS made things right at the end.

    Will I trust anyone regarding HW tank rentals? HELL NO….

  25. Alexandria

    Jun 1 2011

    Direct Energy is of course stewing because they are reaping what they sowed in terms of competition and door-to-door scams.

    I am glad the shoe is on the other foot for them. I have witnessed their agents scam many very old seniors when I lived in a Toronto apartment complex, claiming they were owed a credit on their gas bills and demanding to see the bill in order to put in for their credit (what nonsense).

    Then they would blatantly steal the seniors’ address and name off of the bill and place it on the Direct Energy contract, thus signing them up for a new gas contract with Direct Energy without explaining the rates or terms and having the seniors sign these contracts, just showing them the bottom half, claiming it was for their gas credit because they were overpaying.

    They tried it numerous times with me and I have had to intervene in their scams with several elderly neighbours who could barely understand them and who they were pressuring to just bring their bill to the door under the pretense that they can get money back. Which retired home-bound person doesn’t want to hear that?

    Just Deserts, Direct Energy!

    This is why I switched to National Home Services the second they came to my door to take away my inherited Direct Energy water heater (inherited from previous homeowners).

    This is how Direct Energy grew to where they are. Now they are on top, they want to pretend they didn’t train similar salespeople or pressure them to scam and push themselves into homes to grow their business.

  26. JB

    Jun 15 2011

    I am so glad to read this article and know that I am not the only one!
    I had been dealing with Reliance Home Comfort to rent a furnace and air conditioner.
    From the beginning, I had nothing but problems with them. First, the company (independent contractors) that installed my furnace and air conditioner, removed my old ones after I asked them not to (I asked them not to so I could scrap them and make a few bucks).
    Second, I did not receive and air conditioner cover, and since I got it in the winter, I figured this would be important to have.
    Third, they did not send in the information so that my husband and I could get the “Cool Savings Rebate” that they had promised I would get.
    Fourth, and finally, they billed me $20 more than what my paperwork had said.

    I was starting to get upset, so I gave them a call. Their answer was astounding: “not our problem,” “someone will get back to you,” “someone will get back to you,” “I will have someone call you within the hour,” “someone will get back to you.”

    Things were starting to get out of hand as many months have passed and NO ONE EVER GOT BACK TO ME!

    I then decided to get their attention, so I stopped paying them. I had their collections department call me and when I explained the situation to them, they said they would get me connected with someone right away and we would have it sorted out. “Also, please make your payment as soon as possible.” After waiting for about 5 minutes, someone finally picked up and then hung up right away.
    I waited for them to call me again. The same thing happened but this time I spoke with someone and they said that someone was looking at my file and they were going to call me. I explained to the CSR that I have been waiting for a call back for over 5 months now and no one has ever called. She seemed like she did not understand my frustration and just said that someone would call. After 2 more weeks of waiting, I decided to discontinue their services as clearly, we were getting nowhere.
    So I called and informed them that I was going to cancel and gave them the laundry list of reasons why. They then told me that I could not cancel as I was under contract (they had told me this previously but only the person dealing with my case could discuss this, apparently).

    I informed them that I had no point in time, signed a contract. They placed me on hold and then confirmed that I did not. Then, they proceeded to tell me that in order to remove their products, it would cost me $1500.00!!

    I asked where I could find that information and when it was presented to me. Her exact words were “m’aam, I am not making this up”. I told them that they would need to remove their products from my house or they would not receive a payment. She agreed, and let me know that someone would call me the following day to set up a time to have my products removed.

    A few days has passed, and no phone call has been made and their collections department has left threatening voicemails on my phone and nothing has been resolved.

    If anyone knows what can be done in this situation, PLEASE, let me know. I am running out of options.

  27. Helen

    Aug 28 2011

    Last night, a gentleman in an orange and yellow contruction vest, clipboard, and company ID tag from “Empire” rang my doorbell offering to check my water heater. He claimed it may need to be replaced due to changing government regulations on the size of piping that is being used.

    I declined, telling the gentleman I didn’t require any water heater services whatsoever. What I didn’t tell him was that I had JUST installed a brand new water heater in my home that morning and cancelled my rental contract with Direct Energy.

    But the presentation could have fooled some people into thinking it was a government mandated inspection. They could possibly end up with a useless contract.

    Word really needs to get out about these door to door scammers. What they say is misrepresentation and really puts the most vulnerable of consumers at risk.

  28. Ann

    Nov 18 2011

    Truthfully, I have had problems with Reliance for years.

    I am glad I took up the offer with Livclean. Have lots of hot water and when I rented the tank with Reliance it was replaced 3 times by faulty tanks which up till now I still assume were refurbished and not brand new.

    And isn’t wasn’t Reliance doing what these other companies are doing now? hmmm….

  29. Darling Wife

    Jan 11 2012

    Just had a guy come today. He said he was going to give me a free hot water tank. I was in the shower when this all happend. My DH opened the door and let him in. He immediately went downstairs to look at the tank. I jumped out of the shower and sought after him. He told me that it was contract with energy one and enbridge. I gave him my bill and he took the info down. 2 things I noticed right away was a bagde with his name on it (the ones that you have to scan and are hard plastic.)and a list of names from arround the nieghbourhood. Would like to know if anyone else had the same guy I had today. His last name was Ngo, vietmese, first name I can’t remember. He also mentioned the green engery bill. He said that my tank is 34 yrs old, too old to run. Also looked at my furnace too. Told me upfront that a gas heater was more expensive to put in and that the electric heater was free and so was instalation. Made an appointment to come tomorrow and install it. Is this a scam or not? I am not to keen to be trick or have someone try to do damage to my home. I have little ones. Thinking I will be sending them away tomorrow.

  30. Brody

    Feb 12 2012

    If you update the rental with direct energy, you are committing the house to a contract unheard of before in the industry: the life span of the tank.

    So what does this mean? You can only change the tank if it breaks… so if it’ll be 25 years and still working and you’re with direct energy, you aren’t getting a new one without paying a cancellation fee.

    On top of that, they bad mouth the competition, but they don’t even tell their own customers that there is this term. They just make them sign after the installation. And the reps over the phone are trained to answer all questions in a manipulative manner.

    For example, National came to my door and offered me a new tank, but there is a 15 year contract on it. What are your terms and conditions? Their answer: You are going to be billed on a month-to-month basis.

    For the record, National is owned by the guy who build up Direct Energy. He cashed out and attacked his previous company… Smart guy.

  31. Vic

    May 24 2012

    Wow, a girl came to my house this afternoon claiming to be from NHS but with no i.d. , just her binder. She was well spoken but immediately turned angry when i told her she could do better by going to school. she punched my two front teeth out, luckily i found them under the porch. I did sign the 15 year contract though after the brawl!

  32. GEH

    May 26 2012

    All Direct Energy is good for is taking your hard earned money.

    My old HWT was a DE rental and in the 10 years we had it the price per month kept rising from about $10 at first up to finally about $18 month.

    No problems with the tank in those years, but with the price I was paying, I could have bought a couple of HWT.

    So I now own my HWT. It’s been 3 years and no problems. So far so good and no paying DE for doing nothing.

  33. Truth

    Aug 8 2012

    OK HERE’S THE TRUTH EVERYONE’S BEEN WAITING FOR. 

    Ellen’s first post is accurate about Enbridge and Union Gas transfering ownership of the tanks to Direct Energy and Reliance.

    Now here are some Facts.

    1. When these giant buyouts were made by Reliance and DE, they just bought over all the tanks. Neither RE nor DE communicated individually with the consumers who had these tanks.

    2. There were no contracts between these NEW owners (DE and Reliance) and the consumers. There are still hundreds and thousands of these tanks that are out there, most are very old.

    Because there was no new paperwork signed between DE, Reliance and their consumers, you consumers are technically NOT under any contract. 

    HENCE, if you have one of those old tanks, mostly those prior to SEPTEMBER 2010 or 2009, they are all mostly WITHOUT CONTRACT. Now this means a couple of things.

    a) You can straight up call the company that owns the tank and say you want to get out of the rental. This is what you say if your tank hasn’t been changed and you haven’t signed any contract post 2009:

    “Hi, I am going to Home Depot and purchasing my own tank. I’d like to schedule a removal of your tank so you can have it back” 

    They will try to convince you to stay on, but don’t give them ANY other reason or explanation besides “I’m getting my own tank. If you want your tank back, have it removed. I am legally not obligated to answer your questions or keep your tank.” 

    You’ll see magic happen. 

    b) Your tank is likely anywhere between 10-25 years old. A lifetime of a tank is about 10 years. The older ones weren’t built like the new ones that have better insulation. What that means is, Your tank is on 24/7 to keep your water hot. Over the years, there is a sediment buildup on the inside of your tank.

    1a- What does that mean for your energy bill? It take more and more energy every time to push the heat through all those layers of sediment to keep your water hot. 

    1b- Your water is probably filthy inside and this is the water you are consuming to shower, cook food, etc. 

    THIS IS VERY DANGEROUS. Now this is technical information. I will deal with how you deal with the next step.

    3.) ALL COMPANIES dealing with hot water tanks, furnaces, do business the same way. Before, the market was almost an monopoly with those two companies throwing their weight around. They had no competition, and therefore, didn’t care much for customer service, competitive rates and ethics.

    Now that there are more competitors in the market, so the giants are starting to get very very afraid. Direct Energy has more than 400-500 tanks being taken from their business every single day.

    What good companies would do is fight a healthy battle and offer their customers something more to keep them. DE did not do this. Instead they spent millions of dollars on marketing.

    Their marketing strategy was FEAR. Instill fear into your customers and they will stay without an argument. So they started putting up flyers and newspaper ads WARNING people of OTHERS coming to your door to change the hot water tank and asking you to tell them to GO AWAY.

    It would cost DE probably the same or less to actually replace people’s 25 year old tanks, but they make more money from keeping the tanks rotting in your basement. So they decided to invest in keeping them there. 

    INTERESTING FACT: Direct Energy had been scamming people by selling them fixed rates on gas. THE GOVERNMENT then BANNED DIRECT ENERGY from going door to door.

    Now you get WHY they published those ads and flyers? They’re no longer allowed to do door to door business, which opens the door wide for competitors who aren’t YET banned to steal their business. And that is exactly what is happening. 

    Now THIS IS WHAT YOU NEED TO KNOW:

    The hot water and furnace business has become a cutthroat industry, super competitive with no boundaries. So they lie at the door and misrepresent themselves. Through their fast paced 4 minute pitch, it’s hard to remember what they said.

    HERE ARE THE FACTS:

    1. If your tank is old (more than 10 years), you should change it. It works fine but so does a 25 year old car, but it takes up more gas and no longer gives you the mileage it did when it was new. The new one will save you a decent amount on your gas bill. 

    2. The water from those tanks is dangerous and your family and children consume this water. My dad always said, when it comes to health, don’t be cheap and compromise. 

    3. The government DID change the codes on the piping. The ABS piping (the black ones) tend to crack in the winter and should no longer be used. The new PVC piping is the approved one (there is a specific one the government expects these companies to use, but neither uses them. They use a slightly cheaper one, but it’s still better than the black ones) 

    if you decide to rent, you NEED to know that REGARDLESS OF WHICH COMPANY YOU GO WITH POST 2010, THEY WILL ALL HAVE CONTRACTS, NO EXCEPTIONS.

    WHAT YOU NEED TO DECIDE IS: Do your research on each company. They all have different contract lengths. Be careful about the terms and lengths. Most companies like RE and DE will keep making temporary fixes and repairs instead of giving you a new tank.

    THIS IS WHERE YOU CAN TAKE ADVANTAGE OF THEIR COMPETITORS when they come to your door! Your current company will try their best to keep their tank in your house as much as they can and tell you all kinds of things so that you are scared into keeping it. Know your facts.

    Do you want them to keep coming and making small fixes constantly or would you like a brand new tank? Research companies that offer you a new tank. You should not pay anything extra, because you are giving them business and they will do whatever it takes to get your account from their competitor.

    1.) They will change your tank for free ( which means NO installation charges, no delivery charges, no removal of old tank charges).

    2) Most companies will deliver your own tank to its previous owner like RE and DE at no charge.

    3) DO NOT PAY for the change of piping from ABS to PVC. IT is legally mandatory for WHOEVER CHANGES the tank to install the new PIPING!!!!! So if Reliance or DE says they’re going to charge you $180, PLEASE REFUSE. There are companies that will do it for FREE.

    4) Make sure the rental price doesn’t change more than a dollar or two from your current price.

    5.) DO NOT let them sell you on a tank SIZE bigger than you need! If you have 4 people in your house, a PV 40, 50, should suffice.

    A good way to tell what tank size is right for you is to go through your daily activities and see if you RUN OUT OF WATER. If you do, then you need a bigger tank. If you DON’T, then you DON’T need a size bigger and tell the agent to replace your old CV tank, which is the conventional tank (that vents out through the CHIMNEY) for a new PV (power vented tank that vents out through the white pipe) of the SAME size.

    6.) Read the contract properly: Things you need to look out for:

    a) Inflation of prices: if the company clearly states that their rates won’t go over a certain percentage, at least you know it won’t go over 2-3%.

    The current tanks without contracts, the ones that got bought over, if you have one of those, then you are really unprotected because, there was no signed agreement between DE and RE and you, so they can legally hike up prices when they like. They have been known to increase prices by 10-20% and there’s nothing you can do about it.

    So getting a NEW CONTRACT IS ACTUALLY GOOD, if it mentions the maximum inflation rate.

    b) Secondly, all new contracts regardless of company are now a minimum of 10 years. DO NOT SIGN contracts that say lifetime (it means lifetime of tank and you are doomed). 10 years is really reasonable as that is the lifetime of a good working tank.

    But REMEMBER, even after those 10 years are up, the company is NOT going to call you. YOU HAVE TO CALL them and say, “My 10 years are up,” and if you wish to continue renting. say you would like a new tank. and legally they have to get you one, as per the contract.

    KEEP YOUR CONTRACT PAPERS SAFE and make copies and scan them so the ink doesn’t fade in 10 years and you have a digital signed copy for backup.

    ________________________________________________________________________
    NOW here is some technical information about the tanks:

    CV: conventional venting through chimney (NOT EFFICIENT OR ENVIRONMENTALLY friendly), as a lot of heat is wasted through the chimney.

    PV: Power vented. Vented through pipes. More efficient.

    Tankless: Most efficient, as unlike in your ROUND tanks, the gas isn’t on 24/7 constantly heating up water, even when you’re not actually using the water. This system has existed in Europe and Asia since 40+ years. You only heat up water when you need it. It’s efficient and there is no limit or size on the tank. You get an UNLIMITED supply instead of having to choose a 40,50 or 60. Good for when you have visitors and guests during holidays, since you don’t have to worry.

    AS CONSUMERS, REMEMBER COMPETITON IN THE MARKET IS GOOD FOR YOU. WITH MORE PEOPLE SELLING SAME PRODUCT, THEY HAVE TO OFFER YOU A BETTER RATE TO SELL YOU THEIR PRODUCT.

    SO NEXT TIME AN AGENT COMES TO YOUR DOOR TO CHANGE YOUR WATER TANK, remember that there is nothing like a MANDATORY CHECK or QUALITY CONTROL CHECK.

    IF you have an old tank and you want to get it changed, HONESTLY HE doesn’t even need to see your tank, if you know How old it is.

    The reason he checks the serial number is because that tells him the age of your tank. That also tells him if the tank belongs to National or Reliance or LivClean or whatever. Certain tanks which are under contract THEY WON’T CHANGE anyway. So if your tank is old and he says it’s fine, it’s probably because it’s under a contract and his company would get sued if he touches that tank to remove it.

    REASONS WHY THEY DO VALIDATION:

    The company needs to check the ownership of your house to make sure YOU ARE THE OWNER OF THE HOUSE that is authorizing them to do the change, Because tenants cannot authorize them to change the tank. That’s why they put you on the phone to talk to someone. Once you’re verified, only then they can change your tank.

    Also if someone is doing financing instead of a rental, they will do a credit check to make sure you’re capable of paying the amount. All the is normal.

    WHY THEY ASK TO SEE YOUR BILL:

    The main reason for this is to get your ENBRIDGE number.

    Certain companies pay ENBRIDGE a fee so that they can be added as a THIRD PARTY VENDOR onto the Enbridge Bill. Having your water tank rental on your ENBRIDGE bill just makes it more convenient to pay for it, instead of getting a separate bill from the rental company.

    They do this again to verify the ownership of your old tank, as it will say so on the ENBRIDGE bill. A lot of people don’t even know who they rent from.

    IF YOUR TANK RENTAL DOES NOT APPEAR ON YOUR ENBRIDGE BILL AND IF YOU DON’T RECEIVE ANOTHER BILL FROM A RENTAL COMPANY, IT MEANS THAT YOU OWN THAT TANK THAT’S SITTING IN YOUR BASEMENT.

    Be careful if you own the tank. You don’t need to rent, you can just go and buy yourself one. But if you want to rent, remember that you’ll be renting for the first time and it’s not a transfer.

    RENTAL vs OWNING:

    Many people prefer renting and owning for different reasons. Same goes for when we want a new car. Do you lease or do you buy? THEY BOTH have their advantages and disadvantages.

    PROS of renting:

    Hassle free. If it breaks down, they fix it or give you a new one.
    The round tanks are known to break down often.

    CONS of renting:

    You do end up paying more, but some people see that as worth paying for hassle free maintenance.

    If it breaks down in middle of the night, some companies offer 24/7 emergency fixes as well, but if you own it and you HAVE A LEAK, you’re stuck until morning when businesses open.

    IF you own it and it breaks down during the holidays when you have guests and business are closed, you are in for some suffering.

    If your TANK IS BEYOND 10 years old, REMEMBER INSURANCE DOES NOT COVER DAMAGES INCURRING FROM A TANK MORE THAN 10 YEARS OLD.

    Also if your TANK is beyond 10 years old, it is DEFINITELY OUT OF WARRANTY, which means you will have to hire a repair guy to come fix it! ADDED CHARGES.

    The guy will first come do an inspection of your tank. HE WILL CHARGE YOU HOUSE CALL. Then he will tell you he doesn’t have parts and will be giving you an estimate for it. You are stuck paying at his mercy or go out a buy a new tank which is quite a few $$$ to put down all at once. Some people can afford it but some people can’t.

    ___________________________________________________

    I hope these facts above have shed a good amount of light on this whole door to door situation. A lot of people feel cheated and it’s wrong. Power to the customer is knowing and doing your research. Having an agent come to your door isn’t necessarily a bad thing. IT means competition and that is good for you as a consumer.

    Know your rights. BE SAFE. Make sure you always ask for an official badge and ID.

    MOST IMPORTANTLY, ASK THE NAME OF THE COMPANY THEY REPRESENT CLEARLY BEFORE YOU LET THEM START TALKING.

    NO ONE FROM ENBRIDGE COMES TO YOUR DOOR AS THEY DON’T OWN THE TANKS. YOU WILL HAVE DIFFERENT REPRESENTATIVES FROM DIFFERENT COMPANIES COME TO YOUR DOOR.

    Remember they don’t have your contact info, and if they CALL YOU BY NAME, it is not because they have you on their account, but it’s because they used 411 or other methods of getting your personal info.

    Watch out for companies who say they’re from Enbridge, because that’s a company that has no ethics. Do you really want to do business with them?

    DON’T get mad at the agents. They’re just regular youngsters trying to make big bucks. They get good commission from this. Blame the companies that train them to conduct business in inappropriate ways.

  34. Truth

    Aug 8 2012

    Btw Direct Energy couldn’t handle their competition any more so they’ve moved to Houston,TX. They were losing clients to competitors at an alarming high rate.

    I guess now they’ll just have to maintain their clients that they currently have under contract. I guess now it’s their Time to Scam the US. God help them poor people.

    Research research research before you buy anything, people! I can’t say it enough.

  35. barry miller

    Dec 13 2012

    In addition to scamming customers on a regular basis, MorEnergy advertises for salesmen at a very attractive starting salary.

    There is no such salary, as I found after having worked for this company for a short time. I believe with their business ethics, a representative should insist on danger pay.

    Customers, I hope, will just not open the door.

  36. Frank

    Jun 21 2013

    I move to a new house and this guy shows up at my door. I’m thinking he’s there to check the gas meter, as he’s wearing a construction vest.

    What happens is he’s really a sales guy, who tries to get me to sign some paper work. He says its for a “free” new water heater, just a upgrade.

    I read the document and it’s a 10 year rental agreement with a horrible 9% interest!! What a scam!

    Don’t be fooled by this company. The staff are misleading and looks like they’ve tricked a lot of people…

    Said his name was Ijaz from Reliance Home Comfort and the telephone number 647-618-6767.

    Watch out!!!

  37. Jeff

    Oct 2 2013

    What kind of dummy rents a water heater? Why would you pay multiple times more money for something than it was worth when it was new, while it steadily deteriorates & depreciates?

    Rich people own, poor people rent. Fact of life.

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