ESB: unlicensed moneylenders

HOW much is a unit of electricity? Twelve cents? Twelve euro? Twenty cents?

Confess, you haven't a bull's notion.

Well then, how much is a litre of petrol? Ninety-five cents? One hundred cents? One hundred and twenty cents? You have a pretty good steer on that one. Sometimes you even travel an extra mile to buy cheap petrol.

How many miles will your car travel with a full tank? You have a fair fix on it.

How many hours heating will a unit of electricity provide?

Give up? Perhaps you pay your ESB bill by standing order? What a mug.

Whichever way you pay, you never protest and rarely query the bill. You do not really understand it, but you are a bit scared of being cut off.

You help yourself to petrol, watch the meter clock up the litres and pay.

The difference between these two methods of buying energy is stunning. When you buy petrol, you are in charge. When you buy electricity, the ESB has you at its mercy.

For years, I thought of the ESB as a sort of benevolent tyrant; not the worst of the semi-state monopolies, preparing to enter the commercial world and a candidate for early privatisation.

Wrong again.

Last week my innocence was shattered. The ESB is up there with the banks as one of the most anti-consumer outfits in Ireland. It is in blatant abuse of its dominant position.

You are possibly a victim. At least 50,000 ESB customers probably are.

Did you ever pay an "estimated" ESB bill? If the answer is "yes", you are in the danger zone. The ESB probably owes you money.

If you have received an estimated ESB bill in the last six years, you will sooner or later have paid a final amended bill -- after your meter was accurately read. The correct number of units will then have been recorded. So far so good.

A final amended bill is made up. An accurate number of units is agreed. The bill is paid. No dispute.

Not quite. The chances are that your estimated bill extended over a period of a tariff price increase. If it did, you could be owed a refund.

The entire difference between the final bill and the earlier estimated bill will be charged at the increased, but later, rate per unit. You could have used the electricity five years ago, but you will be charged at today's rates. You will not be told. You will just be forced to pay the bill at the inflated rates.

The Energy Regulator's office was startled to discover this bizarre, but systematic, billing abuse last week when I told them. An official promised, as regulators do, to investigate. The Energy Regulator was under the mistaken impression that these bills were paid pro rata. They are not. The Regulator should have known this.

When I challenged the ESB, they came out waving the white flag. They admitted they were practising this sham.

They called it "overbilling", not "overcharging." And they expected me to blink and vanish. They had no intention of doing anything to pay back all those customers whom they know they have ripped off.

"Overbilling" was the default position. It was just tough. The monopolists are shameless.

It is impossible to know how many customers are victims, but a multitude will have received estimated bills stretching over price increase periods. The ESB has managed to fool the authorities into allowing it eight price increases in the last seven years. In 2004, it even swindled two hikes out of the government/regulator.

The more increases there were, the more customers have been hoodwinked. First, they are underbilled in the estimated bill; next, they cross the tariff hike period; finally they receive the amended bill at the latest rip-off rates.

My own guess is that the number of victims extends well beyond the 50,000 the ESB is grudgingly prepared to admit is possible.

I have recently listened to the most tortuously comical excuses for overcharging known to man. The ESB's spin doctors make the banks' soothsayers look like the archangel Gabriel.

Why did they do it, I asked?

Well, they pleaded in mitigation, there were beneficiaries of this flawed billing system too. Some customers (very few) were overbilled by estimated bills. So they benefited by receiving rebates at the top increased rates.

So the victims of overcharging were subsidising a few lucky punters?

Precisely. Tough luck on the ignorant subsidisers.

Not a very fair system. But the ESB is happy to live with it. The accuracy of individual customers' bills is irrelevant. Especially as the poor sods haven't a clue that they are being soaked. It works well for the monopoly. The bottom line figure is better and the masses are blissfully ignorant. Besides, better still, they have no choice.

And then the classic piece of arrogance. The spokesman compared the ESB malpractice to credit card sharks: the victims of the ESB had helped themselves to the electricity and had use of the money for months, if not years. The ESB had no means of extorting interest, so surely penal charging was a fair way of recouping the extended credit?

Welcome to transparency, ESB-style. Charge the customers interest and penalties. Never tell them. If they challenge your figures, surrender. Reimburse them, but only the very few that rumble your systematic overcharging.The ESB is now not just a monopoly , it is a self-appointed, quasi-bank. Unlicensed, it charges interest by another name.

Selective reimbursement is the state-owned utility's practice. They admit it. A close relation of mine challenged them with this very piece of overcharging which merited an €800 refund! He had paid his estimated bills. His final bill of €4,312 was so crippling that he decided to query it. He discovered the scam.

The ESB immediately offered a refund. It admits that it never repays this money to similarly wronged customers, unless challenged.

If you are one of the other 50,000 I suggest that you contact the ESB. You too are entitled to have your bills over the last six years reviewed and to reclaim any excess paid.

The ESB is diseased. There is no competition in the market. Customers understandably simply pay their ESB bill as they have no real alternative source of supply. If they were buying petrol, they could go to the next station.

When I asked the regulator last week what the office was doing an official said a meeting would be held "next week".

Which day?

"It is not yet arranged."

The Energy regulator is a paper tiger, incredibly not even aware of this overcharging dodge. Even IFSRA, the banks' watchdog, would be crawling all over a bank's books by now, ready to force an immediate change.

Find out the cost of a unit of electricity. It is the last thing the ESB wants you to know.