Shell Energy to axe £15 broadband switching 'cease fee'
Shell Energy is to scrap a controversial £15 'cease fee' it charges customers who switch away from the firm or cancel their contract, MoneySavingExpert.com can reveal. It comes after we queried the fee with regulator Ofcom and it asked Shell Energy to explain the charge - though Shell insists it was already reviewing the fee as it prepares to take on 450,000 Post Office customers later this year.
Update: 4 October 2021: Shell Energy axed its 'cease fee' today and removed it from its terms and conditions for both new and existing customers. This means the charge no longer applies if you switch or cancel your contract - regardless of when you joined or what your terms were at the time.
Currently, Shell Energy charges the fee as standard to broadband customers who decide to leave it, and unusually this applies even if you're outside your minimum contract term - though anyone who has taken out Shell Energy broadband via a blagged MSE deal is automatically entitled to have the fee waived.
Now the broadband firm has revealed it's scrapping the fee for all customers - currently 150,000 in total - when it rolls out new terms and conditions in the coming months. It hasn't said exactly when the change will take place though and also says it won't refund customers who've been charged the cease fee. Early termination charges will continue to apply as normal for those who leave while within their minimum contract term.
'I can't believe I've been charged £15 for switching AFTER my contract expired'
We first decided to look into this after seeing a string of complaints from unhappy Shell Energy customers who complained on Twitter and by email after being stung by the fee. Here are just a few of the complaints:
Ofcom is looking into Shell Energy's cease fee - after we queried it
In January, after seeing complaints about the fee, we contacted the telecoms regulator Ofcom to check what the rules are around this kind of cease fee. It said it would look into it and at the start of March told us it had made contact with the company, saying: "Any charge that could put someone off switching would be a concern for us.
"While providers can charge some fees in limited circumstances, cease fees are now very uncommon. So we are asking Shell to explain its rationale for these charges, so we can be confident customers are being treated fairly.”
In general terms, if a broadband provider incurs a cease charge from its wholesaler, then under Ofcom rules it can pass this on to its customers, though Ofcom says there are some scenarios when wholesale charges may not apply. Shell Energy is the only major broadband provider MSE is aware of which charges this kind of cease fee - it says that when it took over First Utility's broadband business in 2018, First Utility charged the cease fee and it's continued to do so since. It does also warn customers of the fee in its T&Cs.
Discussions between Ofcom and Shell Energy are understood to be ongoing, but last week Shell Energy told us that it now plans to scrap the cease fee, even though it believes it's within its rights to charge it. It insists its decision is not connected to Ofcom's queries and says one of the reasons it's axing the fee is in order to simplify the process of taking on 450,000 broadband and home phone customers from the Post Office later this year.
A spokesperson for Shell Energy said: "The cease charge relates to a charge from our network partner which is passed through to customers. We've been reviewing this alongside all our policies, especially in advance of our acquisition of Post Office's business, and we will be removing it going forward as we bring the two businesses together and absorbing the cost on behalf of our customers."
Unhappy you've been charged the cease fee? How to complain
While Shell Energy says it now plans to scrap the cease fee, we don't yet know when that will happen - and it's said it won't refund customers who've already paid it or pay before it scraps it. So if you've been charged the fee and are unhappy about it, you'll need to complain - here's how:
- First contact Shell Energy directly. Call 0330 094580, email email@example.com or use online complaints tool Resolver.
- If you're still unhappy, you can escalate your case to the ombudsman. Shell Energy is signed up to Ombudsman Services: Communications. You can take your complaint to this free service if Shell Energy doesn't resolve your complaint within eight weeks or you've received a deadlock letter saying it can't take your complaint any further. Just follow the steps on the Ombudsman Service's website.
We've featured a few special MSE blagged deals with Shell Energy lately. If you signed up to one of these, different rules apply - you should never be charged a cease fee to switch or cancel if you're outside your minimum contract term (though as usual, early termination charges apply if you leave mid-contract). This is only the case with blagged deals though - if you signed up via MSE to a non-blagged Shell Energy deal, you may be charged a cease fee.
If you got an MSE blagged deal and believe you've been wrongly charged a cease fee, please contact us at firstname.lastname@example.org. Please include your full name, order date, order reference and the email you signed up with - we'll pass this on to Shell Energy to sort it out.