That snake oil salesman at your door these days may just be a natural gas marketer.
The marketers are in Prince George and they are going doo-to-door trying to convince you to switch from Terasen gas to another gas provider. New regulations came into effect May 1 allowing other companies to supply you with your natural gas -- using the Terasen lines that already go into your home. Very similar to what happened with phone service a few years ago.
The natural gas marketers, however, are going door-to-door and giving many residents the ‘hard sell.’
I talked to one Prince George senior who had marketers from two different companies hit up within two days. The first company used a pair women and the second was a young man, apparently from Ontario. All were very aggressive ╔ telling the senior she had to sign the paper they were waving in front of her. The second marketer, when told the senior had signed with the first two women, didn’t stop and still urged the senior to sign up with his company.
All were promising better gas rates than Terasen. And this is where some of these marketers have gotten themselves into trouble ╔ and there are a lot of them. More than 1,000 sales people representing 15 rival firms are trying to convince Terasen customers, including those in Prince George, to switch under new provisions that allow them to choose alternate gas suppliers.
B.C. Utilities Commission secretary Rob Pellatt told Black Press there have been at least 30 complaints in the first half of May and some apparent violations.
“We understand they have been dealing with it internally with their marketing representatives,” he said. “It’s more of a teething problem from what we’ve seen.”
He said some marketers have illegally claimed customers will save money by signing up for their contracts, while others have given the false impression they represent Terasen.
The senior I talked to showed me the contract she had signed and her Terasen bill. Sure enough, the contract with the marketer was at a higher rate than her Terasen bill.
The new providers offer long-term fixed rates – akin to locking in a mortgage for several years instead of paying a floating variable rate.
Right now the three- to five-year rates offered range from $9.24 to $10.99 per gigajoule (GJ).
The new providers offer long-term fixed rates – akin to locking in a mortgage for several years instead of paying a floating variable rate.
Right now the three- to five-year rates offered range from $9.24 to $10.99 per gigajoule (GJ).
That’s significantly higher than the $7.66 per GJ Terasen currently charges, so homeowners who sign up now will only save if current gas rates move sharply upward.
“They may save money and they may lose money,” said Pat MacDonald of the B.C. Public Interest Advocacy Centre. “It’s like the stock market.”
Terasen’s rate for gas has fluctuated between $6 and nearly $10 per GJ over the past five years.
People who switch may also incorrectly think the rate they pay the alternate supplier is all they’ll pay.
In fact, they must still pay Terasen $2.77 per GJ to deliver the gas, plus basic monthly fees.
That transmission charge is where Terasen actually makes its profit, while it must pass on the commodity cost of the gas to consumers at no mark up.
Other providers are under no such restriction and add profit margins to their gas prices.
In effect, residents who sign up will pad the profits of not just one but two companies.
“That’s how these people are making money,” MacDonald said.
Some of the new providers also offer options to make natural gas use “carbon-neutral” by paying an extra 50 cents per GJ.
When consumers choose that option, the provider promises to buy certified carbon emission credits from projects like wind farms or biomass plants to offset the carbon dioxide their homes emit from burning gas.
The senior I talked to will be canceling the agreement she signed. Under provincial regulations brought in a few years ago, you have a 10-day cooling off period to cancel any contract signed with a door-to-door salesman.
The only advice I have is read everything before you sign anything. Ask salespeople to leave information with you so you can read it at your leisure and decide. If they can’t do that for you, it should set some alarm bells ringing.