Nabuh Energy customers face repeated problems with supplier
Nabuh Energy customers have had a rough ride recently. In the space of a few months, the Sheffield-based supplier has had a run-in with Ofgem, a website collapse and now a falling out with an energy-industry partner. What’s going on at “the energy company with a heart”?
Nabuh Energy has been in the market since 2015 and is headed by Klaus Bach, a Danish investor. However, 2019 has seen a number of problems hit the firm.
What did Nabuh Energy do to attract the attention of Ofgem?
Ofgem was forced to issue something called “a provisional order” to Nabuh Energy in the Autumn.
The supplier was one of six instructed by the energy regulator to submit evidence of green energy purchases, in the form of Renewable Obligations Certificates (ROCs), or else pay directly into a renewables fund by 31st October.
Nabuh had already failed to meet the two previous deadlines in August and September.
The seriousness of the situation can be seen in the case of Toto Energy.
Toto was unable to pay up in time, and had its license revoked by Ofgem making it the 16th supplier to go belly-up in just over a year. Two other firms, Delta Gas and Power Ltd and Robin Hood Energy Ltd, managed to meet the final payment deadline.
The Renewables Obligation (RO) scheme commits UK electricity suppliers to using some renewable energy sources to make up part of their energy supply.
Suppliers have to present the ROCs to show they have purchased energy from renewable energy producers, such as wind farms, or else make a payment to OFGEM to cover the RO commitments.
The final date for this payment was the end of October.
According to Ofgem, in September Nabuh had promised that it would be able to make the payment with interest by the October deadline.
However, the day before the payment was due Nabuh told the regulator that it could not pay its total bill in time.
The RO legislation allows a two-month window for late payments to be made and Nabuh had missed it. So, in response, Ofgem issued the provisional order, basically a final demand for immediate payment of the £880,582 debt.
In a statement, Nabuh explained that, while it had made a “significant payment”, there was still “a balance of monies due to be paid.”
“The delayed payment is not a cause for concern for any of our suppliers or customers and OFGEM have been made aware of the nature of the circumstances which have led to a delay in the balance of the RO payment being made,” Nabuh said.
Why did Nabuh not fulfill its payment obligation?
Unlike the majority of suppliers, Nabuh’s customers are mainly on prepayment meters. This means that the company cannot rely on the regular fixed amount direct debits which gives most energy suppliers a predictable income.
The prepayment model means Nabuh’s customers spend less in Spring and Summer and more in Autumn and Winter. As a new supplier experiencing a growing customer base Nabuh had a cash flow problem when the RO payments had to be made.
The supplier said it had been aware of the pending shortfall in its finances and had made arrangements to cover it.
“Additional funding has been arranged and agreed however due to circumstances beyond the control of Nabuh, we have experienced delays which have caused a delay in the full payment of our RO obligations,” the supplier said.
The debt was eventually settled by Nabuh with two payments on 8th and 15th of November and, satisfied with the outcome, Ofgem revoked the provisional order on the 21st of November.
What other problems have Nabuh customers been hit with?
Also in October, a technical issue meant Nabuh customers were unable to get payments to reach their meters. The problem led to some customers being cut off from their energy supply until the company was able to resolve the situation.
Later in the month the supplier’s website stopped working properly and Nabuh had to provide customers direct links for topping up via Twitter.
Nabuh’s customer service appears to leave a lot to be desired, even at the best of times. On Trustpilot it has one and a half stars out of five and an average rating of “Bad”.
Nine per cent of reviewers give Nabuh a rating of “Excellent”, three per cent “Great”, four per cent “Average” and three per cent “Poor”. A shocking majority of 81% gave a “Bad” rating, the lowest available option.
Many reviews mention the difficulty of getting in touch with customer service both on the phone and online. For those who do get through to an agent, the experience is often reported to be unpleasant and ineffective.
There was more bad news when Citizens Advice looked at the customer service performance of 40 energy suppliers between July and September 2019 and Nabuh came in right at the bottom in 40th position.
The trouble with Nabuh appears to be spreading. More recently it has failed to communicate adequately with energy partners resulting in the company breaking its commitments to an energy industry partner.
Are Nabuh’s customers especially at risk?
The prepayment customers who make up the majority of Nabuh’s clientele also tend to be more vulnerable.
Although typically more expensive, prepayment tariffs are often chosen by people on low incomes who cannot afford to cover the unexpectedly large bills sometimes sent out by suppliers to direct debit customers.
Amanda Manning, director of strategy at the non-profit Ombudsman Services said recently that, according to the organization's Consumer Action Monitor report, vulnerable consumers are far more likely “to suffer in silence and not take a complaint forward” than the rest of the population.
The unnecessary hassle Nabuh’s customers are being put through due to the firm’s various debacles will not go unnoticed by regulators. Indeed, “significant improvements in customer service for vulnerable groups” is a key priority for Ofgem in its Consumer Vulnerability Strategy 2025.
Earlier in 2019, customers of Avid Energy were informed by email that their supplier was closing up shop and that they would be automatically switched to Nabuh Energy by the end of July. Nabuh Energy was chosen to supply Avid’s customers because of “low prices and excellent customer service”. The switch did not go very smoothly according to customers.
The subsequent failures by Nabuh can’t have improved the confidence of Avid’s ex-customers in their new supplier.
With almost 60 suppliers in the UK energy market, poor customer service and uncertainty doesn’t have to be something you put up with. Call Selectra now or click here to find out how we can help you find the right supplier and bets tariff for your needs.