It was actually my 80-year-old parents that drew my attention to this in the first place. I asked them what the EDF letter was all about and they said EDF were going to be reducing their charges. That instantly got my alarm bells ringing, and is probably why I was so annoyed once I had deciphered the letter for myself. I remember when the Halifax started pulling these snide tricks shortly after they became a bank, and look what happened to them! There’s a cautionary warning for EDF. Dance with the Devil and he’ll drag you down to Hell.

Monkfish:

I fully expect EDF to crank up the V6 tariff once everyone has received the letter and jumped ship...

Domestic energy contracts have a get-out clause in the case of changes which result in customer detriment or disadvantage, for example a price increase (EDF Energy Supply Term 3.2 refers).

The big issue, which is not explicity mentioned, is whether the "handcuffs" charge would apply in those circumstances. I'm not 100% certain, perhaps a legal brain will come in, but I'd be surprised if it was.

That said your concerns about, for example, pensioners are very valid. Anybody with such concerns should consider a fixed tariff, not a "guaranteed discount" tariff, which as the EDF V6 tariff rules state at clause 4 is a "variable price tariff".

Monkfish:

...Others are suggesting switching to EDF Online Tariff V6, although there is an early leaving fee of £25 if you leave V6 before June 2011..

Tariffs vary by region and consumption, but for me (hypothetically) V6 would be 0.6% better than V5 would have been, so a good headline tariff, but BIG BUT...

Like V5, V6 is a "guaranteed discount" against the (variable) standard tariff and with an initial discount significantly greater than the 2% "guaranteed", at a £50 dual-fuel handcuffs penalty for a year. IMHO, "guaranteed discount with handcuffs" tariffs are not customer friendly. While the V6 tariff on a headline basis is very competitive, how much do you trust the supplier to keep the initial discount over the standard tariff? My answer is "not much".

You need to consider the different scenarios which could affect the (variable) standard tariff and what could happen to the V6 tariff and still satisfy the guarantee. I have discussed this in this forum previously.

My advice is to fix for a year over the winter period for peace of mind, ie about now. If you are very quick there is still a supplier offering a competitive dual-fuel fix until September 2011. Apologies if you are electric only.

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Obviously I'm not the first to receive this letter. Others are suggesting switching to EDF Online Tariff V6, although there is an early leaving fee of £25 if you leave V6 before June 2011, which is when the V6 tariff ends.

Evidently there was something hidden somewhere that V5 would "be reviewed" at the end of July 2010. I'm sure they highlighted that fact well. I guess they are not pulling the tariff, but simply increasing the charges inline with their standard tariff. So if you ring them up they won't say that it is coming to an end.

At the time I signed up with the tariff at the beginning of 2008 it was sold as a standard (unfixed) tariff that was cheaper because it would reduce administration costs through paperless bills and customers taking their own readings. In practice EDF continued to send paper bills and send round meter readers to check that customers weren't fiddling their meters. I was never made aware of a time limit on the existence of this tariff.

Naturally EDF are putting up the price just before the winter season (no change there).

Regardless of the details of this tariff, this thread is principally about the use of cynical and misleading customer correspondence. Many pensioners wouldn't have a clue as to the truth behind such a letter. It's disgraceful.

Monkfish:

I would like to add that the Online Tariff V5 was not one of these fixed price deals with an expiry date...

I think it was a "guaranteed discount" against the standard tariff. From memory, though I stand to be corrected, the "guaranteed" discount was 2% though the "initial" discount was significantly higher.

I would be surprised if there wasn't originally a minimum tie-in, though I don't recall what it was. One or two previous posters are/were on this tariff and may enlighten the forum.

Just to be clear - has your EDF Online Tariff v5 reached its expected end date - or have they unilaterally cancelled a fixed price deal whilst it is still live???

If case 1 is true then you should have been looking for a better deal already!! Most Utility suppliers switch you onto their standard tariff when the deal comes to an end.

Monkfish:

...As an EDF Energy customer on our Online Tariff Version 5 product, you’ve benefited from one of our best deals...

But that's also true. I think they are wanting to recoup some profit not made from you in the last year or so. All that marketing training and salary and it didn't work with you (or me).

You post is a good heads-up but I would advocate everybody benchmarks their tariff from time to time using a Consumer Focus accredited website. There is one linked to this website.

The OPs offer was a transfer to a standard tariff which would not have had a tie-in. If a fixed tariff is due to mature, be particularly wary of the offer of a fixed term maturity tariff. Always compare the offer with the whole of the market. I explained how to compare unlisted maturity tariffs in this recent thread.

http://www.moneysupermarket.com/community/forums/t/which-british-gas-tariff-is-best-43400.aspx

Always look at the tariff small print. There are small-print "gotchas" for the unwary.

This thread pertains to anyone on EDF Online Tariff Version 5 and possibly other online tariffs. If you have received the following letter from EDF please list your current tariff here so we know which are being affected.

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This letter from EDF Energy is a classic example of marketing misdirection. This technique involves the offering of an insignificant benefit that can be hyped in a letter, to camouflage the principle disadvantage that the letter is actually about. In this particular case, the insignificant benefit is the small increase in Direct Debit and Dual Fuel discounts that hides the principal point of the letter, which is the fact that the current tariff is being discontinued and replaced with one that is substantially higher. This letter should read:

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“Dear Customer, we have decided that your current tariff is WAY too generous and have decided to take it away from you. From August 2010 you will be paying 62% more for the first 225 units and 30% more for the remaining units of electricity you use, and 20% more for the first 670 units and 2% more for the remaining units of gas that you use. To compensate for this loss, please accept this packet of peanuts.”

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Here’s the actual letter:

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Dear Customer,

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Great saving with EDF Energy

As an EDF Energy customer on our Online Tariff Version 5 product, you’ve benefited from one of our best deals. In fact, a typical customer could have saved up to £446¹.

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From 1 August 2010, we’ll be aligning your prices with our competitively priced Standard tariff. Your new prices are on the reverse of this letter.

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If you would like to go through our full range of available products, visit www.edfenergy.com/online

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Your monthly Direct Debit and Dual Fuel Discounts

Because you’re paying by monthly Direct Debit for both gas and electricity you’ll save even more off your energy bills every year with your new discount structure. You’ll now receive a 6% monthly Direct Debit discount and we’re also changing your annual Dual Fuel discount to £8.40. This means a typical customer that has both gas and electricity with us and pays by monthly Direct debit will now benefit from a discount of £68 a year².

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Save today. Save tomorrow

We’re always looking for new ways that we can help you save energy, and money too. Visit www.edfenergy.com to see how we can help you.

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Yours sincerely, .

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It’s letters like this that really annoy me. Essentially the letter is trying to con you. The larger middle paragraph is deliberately worded to make the reader think that they are actually going to be saving money! There should be laws against this sort of cynical obscuration. The last line is just an insult once you realize what the letter is actually about.

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Well, I’m now straight off to look at other suppliers.