OddThinking

In the past couple of years, I have noticed a new development in the way electricity and gas is supplied around Sydney.

The energy suppliers are hounding me to sign up for a three-year contract. In return, they are willing to offer discounts or use of so-called “green” energy supply.

The first time they sent me a brochure, I thought nothing of it. Here’s a typical loyalty deal – lock yourself in for three years, and get a discount of a few percent. I considered the high-risk that I won’t be living in this same property for three years, and dismissed it.

The first time they knocked on my front door, I was a bit annoyed – the salesman kindly pointed out that the contract is portable to anywhere other property they might happen to service, but wouldn’t take the hint when I said I would take another look at the brochure. Not until I made it clear that there was no way I was signing any contract on the spot did he leave.

The second brochure was easier to ignore.

The unsolicited call on my mobile phone? That got me irate very quickly. Stop bugging me!

When the second salesman knocked on my door the following day, I didn’t let the poor guy even finish his opening sentence. He defended himself saying the previous caller may have been another supplier, but by that stage I didn’t care.

Today, I received a third brochure. This one was more direct. No mumbo-jumbo about green energy, or 4% discounts. Simply sign up now, and get $120 discount on your electricity bill over three years. The fine-print on the inside contained the kicker: the contract early-termination fee is $125 dollars!

Call me cynical, but I am a bit concerned here. For an insignificant loyalty bonus, there is an awful lot of clamouring for me to sign up. What is so special about these deals that make it so favourable for the energy companies? Is it all above board? Will I be hearing promos for current affairs shows in two years’ time: “Tonight, the show no householder can afford to miss: energy companies ripping off defenseless consumers.”

Then I figured that maybe there has already been some action in this area? I visited the NSW Office of Fair Trading web-site. There are no special warnings about signing up to energy contracts (unlike mobile phones, for example).

However, there’s an interesting wrinkle. When a door-to-door sales person or tele-marketer sells you something in NSW, you get certain rights – like a five-day cooling off period. There are some exceptions, including charities, financial deals (like insurance and investments) and customer supply contracts for gas and electricity.

These new provisions came in August 2004 – I don’t know what the legal picture was before then. Maybe this accounts for the recent increase in pressure of the sales techniques?