Nov 04, 2010


By Susan Irwin, Executive Director / Lawyer, Rural Legal Services

Your hydro bill has just arrived. As usual, it’s a shocker, and there is the long winter ahead. You’re on a fixed income, and even the “equal billing” option leaves you short each month. At that moment, your white knight seemingly arrives in the form of a pleasant door to door salesperson who is selling contracts to supply electricity at a rate that will surely, definitely, save you money! But are his promises too good to be true?

In the midst of the practiced and convincing sales pitch you may not notice that the oral representations are not quite reflected in the very complicated wording of the contract. You may even draw the erroneous conclusion that the salesperson is employed by a company that is approved by, or affiliated with, Hydro One even though the contract will clearly state that the energy reseller and Hydro One are not related. You innocently hand over your Hydro One account number, sign the proffered documents, and sit back with a sigh of relief – a financial crisis avoided. Or so you thought.

When your bills from the energy retailer start to arrive, you may wish that you had paid more attention to the fine print! Not only do some people find that their “energy” bill has increased, but when they complain they find that it may cost hundreds of dollars to cancel the contract and return their account to Hydro One.

I would like to believe that there are people who have saved money under these contracts; but at Rural Legal Services we don’t see the happy energy consumers. We see vulnerable people trying to live on low or fixed incomes or pensions who either cannot understand the documents that form the standard retail energy supply agreement, or who simply don’t think it necessary to read the contract, given the wonderful sales pitch. More than a few people have also expressed the belief that they were really just signing something for their Hydro One account and are upset when they realize they have been tricked and that they have not been dealing with Hydro One.

It’s not just a local issue, although we see the results of periodic visitations to our area by sales teams sent out by one or the other of the various energy retailers. In December, 2009, the Ontario Ministry of Energy and Infrastructure pointed out that the practices of energy retailers were consistently in the “Top 10” list of consumer complaints received by the Ministry of Consumer Services and that the Ontario Energy Board was receiving between 100 and 150 such complaints every week.

Faced with practices that obviously need to be better controlled, the Ontario Government has passed the Energy Consumer Protection Act, 2010, which comes into force on January 1, 2011. The act is intended to give consumers greater protection in dealing with “hidden costs, excessive cancellation fees and other unfair industry practices”. Other steps include requirements for “plain language disclosure and enhanced rights to cancel contracts”. It is a welcome piece of legislation. Whether or not it will be able to actually help many of the people who enter into these contracts remains to be seen, and we shall try to have more columns on the particulars of how the new legislation works in the New Year.

In the meantime, people should be aware of their right to cancel a contract signed in their home within 10 days of entering into the agreement. This time period is granted under the Consumer Protection Act, 2002, and is often referred to as the “cooling off” period.

Energy contracts are not simple documents. We would be pleased to talk to you about your rights as a consumer.

 

Legalese is a column of general information and opinion on legal topics by the lawyers of Rural Legal Services, Box 359, Sharbot Lake, ON, K0H2P0, 613-279-3252, or 1-888-777-8916. This column is not intended to provide legal advice. You should contact a lawyer to determine your legal rights and obligations.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

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