The energy firm Co-operative Energy has been wrongly charging customers who want to switch to another provider up to £60 to leave, even though they're in the last 49 days of their contract and should be able to switch penalty-free, MoneySavingExpert.com has learned.
The regulator Ofgem says it's taking up the issue with Co-op Energy, while the company itself has already vowed to review the wording it uses in correspondence to customers and refund those who were wrongly charged.
If you're an energy user with a fixed deal, then regardless of the supplier you're with, a ‘switching window’ opens 49 days before the end date of your fix, and you're free to switch to any other supplier as soon as your switching window opens.
But around 200 Co-op Energy customers on its 'Fair & Square' May 2016 tariff, which expires on 31 May, have been told they "will need to pay" an exit fee even though they are leaving within the last 49 days of their contract.
For more on your energy rights plus how to switch and save, see our Cheap Gas & Electricity guide.
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What have Co-op Energy customers been told?
We've been contacted by a number of users who were alarmed to be told by Co-op Energy that they'd have to pay exit fees. One MoneySaver, Andrew, forwarded us a letter dated 18 April 2016 (43 days before the end of the contract) that clearly states: "Your contract has £30 exit fee per fuel, so you will need to pay this before you leave."
The letter goes on to list six different ways to pay the exit fee, including paying online, at the Post Office or by post.
Fortunately, Andrew was savvy enough to realise his household shouldn't have been charged an exit fee. He told us: “As I am within the last 49 days of my contract term and cannot be charged an exit fee, I find this letter from Co-op Energy to be very misleading. It certainly reinforces my decision to switch.”
Others, however, haven't been so lucky - Co-op Energy's confirmed a number of users have ended up actually paying the exit fees even though they shouldn't have been charged.
What does Co-op Energy say?
A spokesperson for the firm says it will be reviewing the "ambiguous" wording of its letters, adding: "We will be contacting the small number of customers who have received this letter to clarify and reassure them that they will not be charged exit fees within 49 days of tariff end.
"We have identified a very small number of customers who have been charged exit fees incorrectly and are contacting them to explain the error and that we will be refunding their accounts."
How do I get a refund if I was wrongly charged?
Co-op Energy says it will proactively contact you to organise a refund if you've paid and shouldn't have. If you think you qualify for a refund you can also get in touch with Co-op Energy on 0800 093 7511 or via its website.
What's the regulator doing?
We contacted Ofgem for comment, and a spokesperson told us it would be “taking up the issue" with Co-op Energy.
The spokesperson added: “We remind customers that Ofgem rules mean they can switch without paying an exit fee up to 49 days before their fixed term deal ends. For standard variable tariffs there is no exit fee.”
How do I know when my energy tariff expires?
Often, a fixed tariff’s expiration date will be included in the tariff name (as in Co-op Energy’s ‘Fair & Square’ May 2016 tariff), but this isn't always the case.
You can use the search function provided by online energy price comparison service UK Power to find out the end date for your tariff as well as any exit fees you will incur by leaving early.
When your energy fix expires, make sure you compare prices to see if you can save by switching - you can do this using our free Cheap Energy Club. There's a good chance that you'll otherwise be automatically rolled onto your supplier’s ‘standard’ tariff, which is likely to be much more expensive.