Anti-competitive Enercare Rental Water Heater Business Scheme in Ontario

Trueler has received several complaints on companies providing rental water heaters from consumers who want to terminate rent and face over thousand dollars in cancellation fees. We’ve tried to figure out what’s happening, why this kind of unfair business is still working well in Canada, and what can be done in order to terminate it. I’m providing information here for you to decide if you wish to continue subsidizing huge corporations with unreasonably high rates or if you wish to do something about it and stop being a “silent consumer”.
There are two major companies in Canada providing rental water heaters for homeowners: Enercare which is formerly Direct Energy and Reliance Home Comfort which is formerly National Energy Corporation. There are also other companies exist on the market.

They are trying to put you on hook by any means, like advertising the following things:

  • Peace of mind
  • Avoiding breakdown costs
  • Affordability
  • Worry free
  • Great customer service
  • No additional costs
  • No hidden fees
  • “Free” stuff when signing contract like “$200 prepaid Mastercard” from Enercare

Let’s see how much all these nice things really cost.

Rental rate for 50 gallons gas water heater is about $30/month. It comes up to $360/year. Taking approximate life of a water heater as 15 years we are basically paying $5400 for water heater with installation assuming that the rental rate won’t increase over this time. But I bet it will. It may easily become $60/month in 15 years, or even more. Assuming the rental rate will go up by $2/month every year during the next 15 years, we are getting $8100 for water heater from Enercare. Is this a reasonable amount? Let’s see.

You can buy a new 50 gallon water heater for approximately $1000 with taxes included and have it installed for $300. Let’s say $1500 all in – it’s a very reasonable price now for great 50 gallon water heater with quality installation and exhaust pipes upgraded.

Just read it: “I will pay $8.1K – over eight thousand dollars – for water hater which costs $1.5K, and will have “piece of mind” – this is what I’ll pay extra $6.6K for”.

$6.6K for “piece of mind” about water heater for 15 years. Service call usually costs $100 – this is official price of big box stores. Usually it comes down to ~$40-60 if detecting a problem takes about 15 minutes which is usually true for such a simple thing like water heater. If your heater is on warranty it may be even covered. If something serious breaks down – it is either covered by warranty or you buy a new water heater with installation for $1.5K if it is already old enough.

Let’s calculate a bit further. Assuming water heater purchase with installation will be increased twice over the next 15 years to approximately $3K with $2.25K average price, we get $8.1K/($2.25K) = 3.6, which allows us to buy a new water heater with installation approximately every 4 years.

For the price being paid for rent to Enercare consumers may buy new water heater with installation every 4 years. Given that average life of water heater without major repairs is approximately 15 years, we see that renting water heater is 3-4 times more expensive option than purchasing and installing your own hot water heater tank.

Still want to enter into rental contract? Have you ever thought of renting the following stuff:
  • Washer/dryer
  • Dishwasher
  • Stove
  • Maybe TV or some furniture?
  • Toilet or vanity?

How about paying $30/month for your fridge forever which costs about the same as water heater?

Well. If you have not entered into water heater rental agreement yet you are lucky. If you have entered into rental contract less than 20 days ago you may be eligible to cancel it under cooling-off period if you wish to. If you are going to sell your house soon and that’s why you replaced your old water heater tank with a new rental one which will be automatically transferred to the new owner, you are very smart, but may be damned by a new homeowner, so do it at your own risk!

This is what happens after you enter into rental water heater agreement with Enercare:

The only way to terminate rent is to buy out the water heater tank for the price Enercare sets on their website in buyout schedule:

Depending on the water heater type the penalty to terminate rent varies from $1000 to $6000.

For example, the penalty to terminate rent during the first year of 50 gallon water hater with power vent (PV50 in the Enercare’s table) is $1590 + Tax, which is $1796.7.

Penalty to terminate rent for PV50 during 5-th year comes down to $1462.22 which is still a lot. Even during the 10-th year the penalty to terminate rent will be $914.17.

Have you ever seen such outrageous penalties to terminate rent of anything or to terminate any customer’s contract of approximately the same $30/month value?

Water heater rental companies such as Enercare do not give customers any other choice other than to continue rent forever or pay ridiculous termination penalty of thousands dollars. This is valid for water heaters installed after Sep 15, 2010. It looks like it was intentionally introduced by huge corporations such as Direct Energy, Enercare, Reliance home comfort, in order to eliminate the practice of customers jumping to competitors with lower prices.

Such insane terms of terminating rent are captured in Enercare’s rental agreement:

“Termination by You: Your sole method of terminating this Agreement prior to the end of the useful life of the Water Heater is to purchase the Water Heater”.

Anyone can write in the contracts whatever they want, but there is a law which always has more power than any contract!

What the law says with respect to this practice which looks very unfair to consumers leaving us no choice in switching to more competitive options?

There is a Canadian Competition Act C-34:

It clearly says:

The purpose of this Act is to maintain and encourage competition in Canada in order to promote the efficiency and adaptability of the Canadian economy, in order to expand opportunities for Canadian participation in world markets while at the same time recognizing the role of foreign competition in Canada, in order to ensure that small and medium-sized enterprises have an equitable opportunity to participate in the Canadian economy and in order to provide consumers with competitive prices and product choices”.

How does it apply for water heater rentals?

Let’s read it again:

“… in order to provide consumers with competitive prices and product choices“.

As we have calculated, the option of renting 50 gallon water heater with power vent from Enercare is approximately 3-4 times more expensive than the option of purchasing and installing a new water heater. Even taking into account that along with rent Enercare provides service in case of problems (which may be covered by warranty), buying your own water heater is much more competitive option given that for the same money you pay to Enercare for rent you can afford purchase and installation of a new water heater every 4 years. However it doesn’t need to be replaced so often, since its lifetime without major repairs is about 15 years.

Let’s see example if I’m a customer of Enercare renting 6 years old 50 gallon water heater for $30/month which was installed in Nov 2010. I realize that buying my own water heater with installation will cost $1300. If I keep Enercare’s contract and continue to pay rent, I will spend $1300 in 3 and a half years. I’m pretty sure that the new water heater will last longer. Moreover it will have warranty coverage during this time. That’s why this option is much more competitive. I need to terminate rent with Enercare first and they ask to pay approximately $1100 – $1200 cancellation fee (depending on the exact buyout schedule), since buyout is the only option to terminate rent. I don’t need this 6 years old water heater which may be out of warranty for $1.2K, I want a new one with warranty for $1.3K and Enercare to pick their heater from the curb for free as it used to be in the past. Basically for me Enercare imposes rent termination penalty of $1.2K. It clearly looks like Enercare is violating Competition Act in this case.

Let’s see another example, I want to switch to another water heater rental provider who charges $19/month for the similar water heater. Enercare does not allow me to do so by imposing $1200 penalty to terminate their rental agreement. I want to rent water heater, but want to pay less for it. It also looks like Competition Act violation by Enercare.

What does the Canadian Government do in order to enforce Competition Law with respect to water heater rentals anti-competitive practices of Enercare and other companies?

Unfortunately, it looks like not enough, since such outrageous rent termination fees are still part of Enercare’s residential water heater rental agreement. Enercare is even increasing those penalties more and more.

Competition Bureau at least tried to do something, but without any effect for the customers unfortunately. Here is what Trueler found:

Competition Bureau Takes Action to Support Competition in Ontario’s Residential Water Heater Market:

Some quotes from the document:

“OTTAWA, December 20, 2012 – The Competition Bureau announced today that it is taking action against Direct Energy Marketing Limited and Reliance Comfort Limited Partnership, two companies that rent water heaters to residential customers in Ontario”

“Following an extensive investigation, the Bureau determined that Direct Energy and Reliance each engaged in practices that intentionally suppress competition and restrict consumer choice. Specifically, each company implemented water heater return policies and procedures aimed at preventing consumers from switching to competitors. This anti‑competitive conduct affects consumers, other rental water heater companies, and businesses that sell water heaters, such as home improvement centres.”

“Many customers have been forced to continue their rental agreements with either Direct Energy or Reliance, even if they want to switch to another provider, because of the anti‑competitive practices we found in our investigation.”

Here is the resolution from Competition Bureau as of October 30, 2015:

“Agreement with Direct Energy to resolve concerns in Ontario water heater industry”:

 “In December 2012, the Bureau filed applications with the Tribunal against Reliance Comfort Limited Partnership and Direct Energy. The applications alleged that both companies had implemented anti‑competitive water heater return policies and procedures aimed at preventing consumers from switching to competitors. The Bureau alleged that, as a result of those practices, many customers were left with little choice but to continue their rental agreements, even if they wanted to purchase a new water heater or switch to another rental provider. For consumers who wish to purchase new water heaters, instead of continuing to pay rental fees, this is an important issue. The decision to purchase, rather than rent a water heater, can lead to substantial savings for consumers.

“In November 2014, the Bureau obtained commitments from EnerCare Inc., the company which acquired Direct Energy’s water heater rental business in Ontario, that it would not continue Direct Energy’s alleged anti‑competitive policies and practices. At the same time, the Bureau announced that it had reached a consent agreement with Reliance that resolved the competition concerns raised by the Bureau”

Based on this information it looks like Enercare is breaking its own commitments to Competition Bureau as well as violating Competition Act.

Whenever I talk to contractors about water heater rentals, everyone is calling it a scam. They are frustrated as well as customers, since huge corporations, like Enercare, Direct Energy, Reliance home comfort, National Energy, Enbridge have basically stolen huge part of water heater business from contractors by specifying anti-competitive rent termination conditions in their water heater rental agreements preventing consumers to switch to more competitive options.

Even if Competition Bureau is not doing further steps in order to enforce Competition Law and commitments from Enercare, it’s still beneficial to stop renting water heater right away and buy it from the provider for their buyout price. Just divide your buyout price at this moment by your monthly rate and see that it may take just around 3-4 years in order to spend the same amount of money for paying rent. Even if you are going to sell you house sooner, new owners will say a big “thank you” instead of damning you for transferring rental agreement on them.

If you read till this point you probably care and want to put an end to such unfair business practices in Canada instead of remaining silent and do whatever big corporations want you to do.

Here is what we can do to stop water heater outrageous rent cancellation fees, or at least minimize water heater cost for us – consumers:

1) Contact your water heater rental provider and inform that you want to terminate rent and you don’t need their water heater anymore. Most likely they will say that you have to buy it out for over $1000, depending on the model and year installed (if it was installed after Sep 15, 2010). If it was installed before Sep 15, 2010, then you don’t have a problem and they should just remove it from your curb for free or for $75 if their depots are very far from your home. The price they quote to you is basically rent termination fee, since you don’t need their water heater. Call it this way and refer to the Competition Act and Competition Bureau’s resolutions which are provided earlier in this article. Talk to their manager/supervisor who can really make decisions. Sometimes it may be more effective to do it in writing via letter/fax/e-mail/contact form. If it’s over the phone make sure you capture all information about the person who you speak to before starting to discuss anything. If the person you talk to realize that the company indeed violates Competition Law (this is exactly what you need to convince them) and their representative can make decisions, they can offer you significantly reduced buyout price. It’s up to you if to accept it or not. $75 would be fair termination fee – it was the case in the past. Considering your own circumstances you may decide.

2) If you have not reached agreement with your water heater rental provider, or instead of contacting them, file a complaint to the Competition Bureau here (may take about a month or two to investigate):

Explain that you want to install your own water heater, but your water heater rental provider asks you to pay buyout price which is basically a rent termination fee of over a thousand dollars. The main point is that you don’t need their water heater, you want to install your own, but the penalty to terminate rent is $X,XXX which is really anti-competitive and water heater company forces you to stay with them or pay ridiculous cancellation fee.

Only in case of action (complaints to the Competition Bureau and the companies) by multiple victims of their unfair and perhaps unlawful (anti-competitive) practices we can put an end to it.

Please share your thoughts and experience in comments! It may really help other consumers like you.
Note for companies: if you see any inaccuracy regarding information in this article or in the comments, please contact us first and we’ll gladly fix it after appropriate verification.

37 thoughts on “Anti-competitive Enercare Rental Water Heater Business Scheme in Ontario”

  1. Water heater rental contracts forced on by builders in collusion with shell water heater rental companies is the biggest scam going on in Ontario. I bought a house from Mattamy Homes and had to initial an agreement that I would sign on to water heater rental. They did not give me a choice. I have refused to sign a rental agreement when Cricket Home Comfort sent me their agreement though I pay their rental fee billed through Enbridge. They now sent me another letter from their legal counsel to sign their agreement in a bid to intimidate me. I think the government of Ontario should step in and stop the abuse of home owners taken for a ride with these rental scams. These companies provide no real monthly service for the monthly rental fee and exist just to rake in profits. I am sure that if something does go wrong they probably do not have their own staff and have to look for the cheapest subcontractor to do the work. Hence as I read from previous posts delays in responding to emergencies.

  2. Thanks for your very useful posts.
    I have also filed a complaint with the Competition Bureau. I bought a townhouse which came with water heater rental. I’m stuck with it unless I pay $3800 for a tankless water heater.

  3. We moved into our newly built home 2012 and have been paying rental fees for our water heater totaling over $2000.00 to date. At the first of this month the water heater leaked causing a flood in our basement. We called the Enercare emergency phone #. After 1 ½ hours on the phone and being passed from agent to agent 3 times, I was told that the earliest someone could come would be 4 days. I asked to speak with a supervisor/manager and once again was put on hold. I left all my contact info….then waited. We did not hear from anyone until 4 ½ days later. This person showed up at the door, said he was given an incorrect phone number for us (even though I provided the number 4 times). He said he was there to determine the problem and if the unit was needing a replacement, it would have taken another service call. At this point it would have been 5 days without hot water, at the very least! I explained that we had no choice but to have another company look at the water heater, determine that it needed to be replaced and he could look at the unit in the garage and take it, but he declined to do so.
    When I called Enercare to obtain the proper procedures to drop their unit off, they informed me that in accordance to the “Terms and Conditions” I would have to buy out this broken down water heater. The agent said that she had a signed copy of these Terms and Conditions and when we asked for a copy she said we would have to pay $50.00 for it. When pressed, she retracted and said we had “verbally” agreed. When asked the date of this “verbal” consent she cut us off…….The following day, I made another call to Enercare requesting to speak with a Supervisor/Manager….
    In conclusion:
    We are still waiting for contact from an Enercare manager, as promised; it is now 12 days from the time of the initial call to the “24/7 emergency” line. We still have the broken down hot water tank sitting here waiting to receive direction for the “proper procedures for drop off at the Enercare depot”. We are still unsure of the “terms and conditions” (which, to the best of our knowledge has never been agreed to either by way of a signature or verbal consent) even though one of the Enercare agents said she has on file and would send us a copy only if we agreed to pay a $50.00 fee. We still do not know of this “buy-out” fee that was stated we must pay. We are seniors living on a fixed income, have paid our monthly rental fee of $31.19 always on time, for 6 years totaling well over $2000.00 for this water heater. Why on earth would we have to pay more money for a broken-down water heater that would have had to be replaced anyway? Enercare makes the claim “when the equipment you depend on every day breaks down and disrupts your daily routine, you need someone there – fast. Become an Enercare customer and enjoy the peace of mind of Same Day Service”. It took us 4 ½ days for someone to even come to our home, without calling first because they were given the incorrect phone number by the Enercare agent(s). It would have even taken additional days to have the unit replaced, once they determined the unit was unrepairable. We had no other choice in our situation, but to call another company to come and determine the water heater was unrepairable due to the top internal water connection and the drain fitting. We had to replace it with a new water heater at a cost of $1400.00 and a warranty of 8 years, to restore hot water to our home. We gave Enercare every opportunity to respond to our “emergency” and they took 4 1/2 days to even assess our situation. It is morally and ethically reprehensible that Enercare thinks that they can collect rent well over $2000.00 for a water heater and provide such irresponsible service. On top of that, charge a “buy-out fee” and put the onus to dispose of the broken-down water heater on us (which will be an additional cost). As stated before, we are seniors living on a fixed income and are totally appalled, frustrated and stressed with this situation.

  4. I just purchased a house and will have to take over the tank rental. The tank is only 4 years old. Its all rusted on the bottom and leak mark on the floor. I also looked up the model and found out on manufacture website that it has a recall and can be replaced if owner wishes. I just want to get out of contract and install my own. enbridge tells me that they can’t discuss any termination options until the house closes and I have to get my first bill. What are my options?

  5. I compliant to the Competition Bureau and got a call from them today. They can’t help me to break the contract and suggest me to contact The Ministry of Government and Consumer Services. From the Consumer services website, it states I must formally complain to Enercare before I can submit a case to the Consumer services.
    I am wondering is Enercare’s lifetime contract legal or not.

  6. Also to the guy who posted saying that he changed his furnace and they are still charging his mother is an idiot… YOU ARE IN A TERM!!! If you authorize someone to take out a furnace that is not actually yours a “rental” until the end of the term, you basically allowed them to steal it from the rental company.

    Let me ask you this, If you rented a car for 1 month, and then half way through decided to get a different car so you sold the rental car to someone, The company would not only hold you responsible for the 1 month or rental charges, but also the car you just allowed someone to have or sold…

  7. Remove this post, it is actually more in correct facts that correct ones in this post .

    I do not work for enercare or reliance, however I do work in the HVAC industry and what you have written here is an un educated and ignorant post. I will explain below:

    1) Enercare and reliance do not offer standard PV water tanks for 30 a month, they all offer tanks far below that price, from $16/month to $24.99 per month depending on the size, length of term and what is required for install.

    2) The contracts do not go up by whatever the company feels like. They are limited to 4.9% per year max. This depends on inflation. The company borrows money at Prime, takes a risk you will not default on your payment and then installs the tank without a fee up front, simply based off the fact you own your home or have a half decent credit score. In a 10-15 year term, costs of service will go up, (for example as minimum wadge jumps to 14/hr in January 2018, will probably be 25/hr in 15 years) and if the interest rate they are borrowing from the bank changes, they could potentially take go negative on the install.

    3) The water tank contracts very from 7-15 years depending on what you pay. If you are paying $16 per month for a water tank for 4 years and decide you would like to put a different water tank in, obliviously you will have a cancelation fee based on the agreement. Read your agreement before you sign instead of being a stupid consumer….

    4) At the end of the term you do not owe the company anything, you can either return the tank when its junk after 15 years if your on a long term agreement, or you can have the option to buy it out. In most cases the buyout varies from $60-$125 after a 7 year term, and is even at no charge often if it is a term over 12 Years.

    5) Reliance purchased National Water Heater Rentals, the company did not change its name, hence why some customers bills will say “formerly National” on the bill.

    The rest of what you put down is a bunch of baloney as well. Some of the information is factual, the rest couldn’t be more incorrect. Read the contracts first before you make a post

  8. my email address was not correct on the comment I submitted Nov. 8, 2017 for any contact you may have for me
    Ty Preston.
    I would like to have some comment before I give in to the Enercare rental scheme

  9. The SCAM happens with the rental furnace, as well.

    Enercare has been charging my mother, a senior citizen, for a furnace rental that we dont even have.

    I cancelled the rental in April 2013 by telephone.
    For the past 55 months she has been charged $65.98 per month for a total of $3,628.90

    OVER $3,600 from a senior on a fixed income.

    I have tried to resolve this issue several times, to no avail.

    I am NOT paying additional money for the cancellation fee, especially when Enercare has already poached over $3,600 from my elderly mother..
    I can provide written confirmation as to the date when the furnace was replaced.

    Enercare’s customer service denies that the contract has been fulfilled and cancellation was never confirmed. They actually want me to pay even more money to have the charges removed from my gas bill.
    Ohhh, and they are not going to do anything about the thousands of dollars they already poached from my mother.

    Wonderful customer service,,, NOT !

    This is absolutely insane the way Enercare has been taking advantage of a senior on a fixed income.

    Just disgusting !!!

  10. I had Enercare replace a five year old rented leaking 50 gal water heater in May 2015 for a cheaper rent 40 gal water heater. I signed the installers work order as he said it was, no mention that it was a contract to buy it out if I wanted to return the heater at any time. When I called for the replacement the person on the phone never mentioned that I would have to sign a contract. Sep. 2016 I decided to see how much to buy the heater and they said it would be 1614.27 I then said no that was to much I can buy a similar 40 gal at Home Depot for 899.00 + install 200.00 and the lady never said that I was under contract. October 2017 there was a sale on a 50 gal. water heater for 969.00 + 200. install + tax. So I bought one and had it installed by an independent gas fitter, he disconnected the rental unit, brought it up stairs to my garage and said call Enercare they will pick it up for about 75.00 . When I called they said it would be picked up after I buy out the contract. I have no copy of a singed contract and asked them to send me a copy, the lady said read the copy on line, but I want to see my signature on a contract not just your policies. I think they should give me a copy of what I signed. Please let me know what you think I can do to remedy this intrapment. A contract is mutual benefit & agreement

  11. Amazing post. However as there is little action since a while, there are other actions that could probably help resolve this issue by making this public. As the elections will soon be coming, here are few other options that could be taken. If enough consumers act, it really could be something that could have an impact.

    1. Enercare is a publicly traded company. Such practices are in my mind posing a risk for shareholders and they should be warned about them. Maybe purchasing one share and speaking at the shareholders meeting would be a good solution. The funds and companies buying Enercare (and the investors buying these funds) should also be publicly warned of these unethical practices. If your comment is public, maybe some potential clients would think twice before buying these funds. At the moment, the list of Shareholders Elliot and Page owned by Manulife asset management is the major shareholder. Some public messages on Twitter (with enercare hashtag) to @manulife questioning their choices to invest in Enercare would probably contribute to making them (and the people buying their funds) aware that they are supporting a company whose ethics should be discussed. Elliot & Page and sister company Manulife have together around 6% of Enercare stocks. Given the P/E ratios are very high for Enercare, some public discussion about the fragility of their stock, due to the business model used, could start a nice sell-off of the shares… In my humble opinion, Enercare is a very bad bet right now. They are in a risky position. If someone warns the stock buyers, the hashtag to use on Twitter is $ECI ($ is used instead of # when talking about stocks – Manulife is $MFC and )

    A tweet like “Weird to see @Manulife $MFC investing so heavily in #Enercare $ECI with their weird business practices” could probably alert the other users on social media that the way to act is not to whine on Enercare but on the people who buy enercare stock.

    2. What is funny is NEI “ethical” participation in Enercare, very significant for an “ethical” portfolio. or or even the news site talking about the fund as an alternative.

    A discussion with NEI ethical is needed in my mind so they can clarify their position on Enercare business practices. Weird for an ethical fund to invest in #Enercare that exploit most vulnerable consumers with hefty fees. #ESG

    3. Probably investors should be interested in knowing why this stock poses significant risks due to its business model. Blogs discussing the stock should know what you think about the company.

    4. Consumer Council of Canada would probably be glad to see what can be done to develop better policies in order to stop such abusive practices. Along with the consumer council of Canada, the insurers should be worried about this practice. By waiting for the end of the useful life of the hot water tank, risks of damages are way higher and then this creates a risk for insurers too !

    5. The easiest thing to do and more interestingly, Enercare buying keywords to advertise. When you are typing “Water heater rental” or better *competitor name* water heater rental, you should see enercare ad appear. Enercare pays for these ads when you click or take an action after clicking. Click on it, go to the site, and click on the button “ get the deal” or a similar button (often they will only get billed when you will take an action on the site). Then, Enercare might do remarketing… this is where it gets interesting. When you navigate on the web, you see more ads from Enercare. These ads cost way more to enercare, this is where it gets fun to click on them. If you don’t see the ads appearing (because they probably use a negative keyword to filter unhappy consumer), then go in private navigation mode to do your query and you should see the ad appearing. (ctrl – shift – n on chrome to get in private navigation mode)

    6. If @compbureau is monitoring their own hashtag on Twitter, they could notice that #ConsumerAlert could have more messages than usual. People following would notice. After all, consumers need to be warned of such abusive terms.

    Contact the Minister of Energy and Innovation – Narveep Bains – Maybe he will realize this is an issue for consumers and this has an impact on the competition and innovation in Canada – And here is his chief of staff– Gianluca Cairo –

    7. Contact Matthew Baswell the Commissioner Corporate and monopolistic practices at the competition bureau. – from the public directory of public servants. The person specifically dealing with this issue is likely to be Anthony Durocher Deputy Commissioner monopolistic practices at the competition bureau. Anthony.durocher@canada.ca

    8. Maybe Enercare director of marketing Lorne Solway would like to chat with you directly on Twitter about your insatisfaction regarding the service @lsol007.

    9. Leave a review on Google Review / Yelp / Better Business Bureau… IT is not normal to see so many positive reviews for such a service. Basically, consumers should be aware of the small print before signing! This will impact the cost of their insurance as they are likely to change their tank after a water damage that will boost the cost of their insurance.

    10. But if you are not happy with Enercare and hot water rental schemes… tell your friends on social media!

    But above all, make sure this thread is not something that is something you vent on and forget to do anything, do something and things will change!

  12. I am faced with an outrageous termination fee from Reliance after buying a house with their water heater installed. A lawyer could probably help me but the legal fee would be higher than the termination fee. Maybe a class action would make sense.
    Thanks for publishing this all.

  13. Here’s a beauty. I bough the house in 2005 and adopted the rental contract for the water heater. In 2011 it sprung a leak and was replaced for a total service and upgrade cost of around $350. Now in October of 2017 I require the contract be ended due to a renovation and they are requiring a buyback of $935 based on the contract being renewed as if new at the time of upgrade. Apparently I have to swallow that one! The contract is manipulatively structured to unreasonably maximize their income and minimize their risk. How can this be called a contract when it’s intent is entrapment? A contract infers mutual benefit and agreement. This is a prison sentence. And apparently the competition bureau has achieved nothing over the years in spite of acknowledging the need for change in this behaviour.

  14. Thank you Trueler, at least there is some gratification knowing that so many people are also outraged by Enercare’s practices. I wanted to put in a high-efficiency boiler it is a combi boiler and I don’t need the water tank anymore. But to stop the rental agreement I have to pay a huge price of $1300 and they will pick it up. So they get their tank back but I have to pay this huge fee for the price of the tank unbelievable!!! It’s like returning a care after a lease agreement and paying the dealer the full price of the car. No one does that!!! I filed a complaint with the competition bureau. But I am sure I will have no choice but to pay this fee to get the tank out of my house. I would love for a class action suit to start against Enercare.

  15. I purchased a bank owned property on 23/02/15 which had a rental water heater included. I was advised by my lawyer to call rental company and give them my name and state i would like a monthly bill to be sent to my new address. So I did that and waited for a bill, months went by and I received no bill or communication of any kind, so I call again about a year later and asked again for my monthly bill, again months and months went by and nothing came, until last week, and almost two years since my initial request, i finally received a bill, this bill wasn’t a monthly bill, this was a bill for the 20 months that Enercare had neglected to send us a bill, and it was a very large bill that had to be paid in less than 3 weeks. I was shocked and upset after spending over 2 hour on the phone learning that in order to get out of this horrible contract (that i didn’t sign) it is going to cost me $1000, which is the price of a new water heater with a 6 year warranty. This water heater was installed in 2013 and at $26/month has generated $1400 for Enercare, typical installation cost for a water heater is about $300 so exactly how is a $1000 buyout (termination fee) justified, this is an excellent example of a company purposely charging huge termination fees to keep the customer from going to a different rental company or purchasing their own water heater and therefore stifling competition. What a terrible company.

  16. Ontario Consumer Protection Bureau is useless. Here’s their response to the complaint about Enercare and the fact that we never signed anything with Enercare:

    “Thank you for contacting Consumer Protection Ontario at the Ministry of Government and
    Consumer Services.
    Based on the information provided, it appears that you have assumed a water heater rental
    agreement from the previous home owner when you purchased your property.
    Transactions involving real property, such as the assumption of a rental agreement for a hot
    water heater, do not fall under the Consumer Protection Act, 2002. As a result, we regret that
    we are unable to assist you with this matter.
    Under agreements of purchase and sale, a purchaser may agree to assume responsibility for
    an existing contract for the rental of a water heater and will be bound by its terms and
    conditions. If you are uncertain about your obligations in this regard, you may wish to check
    the agreement of purchase and sale for your house and to consult with the lawyer who
    represented you on the transaction.”

    USELESS organization.

  17. I just bought a new house on jun 2017. I wanted to cancel my hot water heater contract so i came online to check the reviews and see how to do that. I have not callled enercare yet but i know im not going to to hear anything good..ill call them on sep 5 and let you guys know.

    is that true if we cancel it within a month..there shud not be any cancellation fee?
    if that the case…i should ask them to install tankless water heater and cancel the contract whithin a month?

  18. On 2017 08 21 and had contacted Enercare a week prior to the move regarding the removal of the hot water tank. I was advised that my name was not yet on record and was directed to the hot water tank removal form online and advised to call back on the day of installation of my purchased tankless water heater for the removal code for the tank.
    On the day of the installation, 2017 08 23, I contacted Enercare to advise and to get the removal code but I was told that I would have to pay $900 plus tax for the cancellation of a contract that was signed by the previous owners. Enercare insisted that by virtue of buying the house, I agreed to the terms of the contract for the life of the hot water tank. I have attempted to reach a resolution with them for the past three days, however, I am not getting any traction with them. I asked to speak with a supervisor to resolve the issue and I was assured that I would get a call back; I have so far called back six times and spoken to numerous representatives and have yet to receive a call back from a supervisor. I’ve been talked down to and educated on the merits or hot water rentals by one representative and hung up on by a number of others. All of these arm twisting techniques are contrary to our Canadian values as Canadians living in a civil society. I understand that there was a resolution reached by Competition Bureau in reference to the Competition Act that would put an end to these types of practices; clearly, Enercare is violating the Competition Act and is in breach of its commitments to the Competition Bureau which Enercare undertook to uphold in December 2012.
    I directed the registered gas technicians that installed my tankless water heater to remove the hot water tank and store in my garage for the eventual pick up by Enercare.
    I have also contacted Enbridge Gas three times and asked them to intervene on our behalf with Enercare; I was assured that they will red-flag it and will contact Enercare for remediation. The Enbridge Gas representative also stated that I should ignore the Enercare portion of the monthly bill issued by Enbridge Gas until a satisfactory resolution is reached.
    On Friday, 2017 08 25, I received a call from a supervisor while driving with my family in the car, so I asked the supervisor to wait a moment as I parked the car; the call was disconnected. I called back right away and asked to speak with the same supervisor; it took 45 minutes for me to get transferred and at the end was again hung up on.
    Today, I contacted Enbridge Gas again and advised them that I’m unable to contact Enercare; the Enbridge customer service rep contacted Enercare on my behalf and ensured that I talk to an Enercare rep. I was initially told by the representative that I can send the tank back to your Thurston Drive location or have it picked up by Enercare for a fee of $75.00 but after being put on a long hold, was advised that it would not be accepted and I would get a call back from a supervisor within 48 hours.
    Also, please note that I filed a complaint with the Competition Bureau.
    Why are we not starting a class action lawsuit?

  19. We have been trying to buy-out the water heater relating to a property we purchased last May 2017. I was given an outrageous amount to buy-out a 6-year old water tank which I agreed to pay, but at this date, 30 August, it has still not been done and the monthly rental continues to be billed. I have spoken to many people at Enercare and received many promises of “this will be done” or “we will call you back” which never happens.
    That organization has to be the worse in existence. They now tell me that it takes 2-3 billing cycles before a buy-out request is processed. What kind of organization these days works this slowly? I suppose one that wants to keep billing you monthly. By the way we never signed a contract with Enercare. It was automatically transferred from the previous owners without us having to sign a new contract. We did not have a choice but to take over the contract or buy-out the water tank which we have been trying to do for 2 months now. It seems to me you should be given the choice when buying a house on whether or not you want to continue renting a water tank. Why people in Ontario continue to pay monthly fees for rentals of heating appliances is beyond me. This is not done anywhere else but apparently Alberta. In over 50 years of owning houses we only had to replace one water heater. The life cycle of the cheapest water heater on the market is at least 10 years and even if you decide to change your water heater every 10 years you would still be way ahead of the game buying instead or renting. Furthermore, why is the government not putting a stop to this practice? I think I will submit a complaint with the Competition Bureau. Couldn’t hurt.

  20. Many thanks for this great write up.
    It appears that many consumers, myself included, are trapped in this. It can be described in no other way but a “scam”.
    Enercare has no corporate conscience , it is morally bankrupt, but of course claims to take the “high road” and is acting within the law.
    Like others, I filed a complaint with the Competition Bureau. In time maybe through weight of numbers our complaints might be heard. Unfortunately time is not on my side, a pensioner in my eighties. However, we have to hope that this practice can eventually be stopped.
    Again, thanks for your article.

  21. New homeowner had to assume the contract,
    $ 35 monthly rental, 5y old 50 GL water heater,
    Enercare Asked $1200 (tax incl) to buyout!
    Don’t know what to do now:

    10 y buyout = $550
    To get there have to pay $2200 rental for next 5y

    15 y buyout = $100
    To get there have to pay $4500 for next 10y

    Or take the bullet, which seems to be the best choice
    Buyout now for $1200= 3 y rental

  22. Im in the same boat as the rest of the posters, except with a furnace rental. I bought a home and had to assume the furnace rental contract. I called the company (Ontario Energy Group) and asked to either buy out or terminate the rent. They wanted about $7000 for either option. This is for a 3 year old furnace that costs about $1500-2000 new. I can purchase the same furnace on kijiji used for $200-400

    So my plan is similar to Domenic. I’ll use the same dirty tactics against them as they use on consumers. I’ll start calling every Sunday and every holiday to complain that the furnace is not working properly. They’ll have to send out a tech every time, and it will cost them WAY MORE than the $80 they are stealing from me every month. If they still want me as a customer after this goes on for a few months, I will sue them in small claims for not being able to provide properly working equipment and not being able to fix it in a timely manner (which I assume will be the case on a Sunday). Do you guys think this is a solid plan?

  23. Its It like a gym membership. You are really paying for a service. Just like the gym you are paying to use their equipment. At no point will you ever own the treadmill at the gym. Sure you can buy it at a store and have it in your home and stop paying the gym membership. But like most contracts you sign, There is a few you pay to get out. I myself rent my water heater. Why? Because the average service call is not $40-60 or $100, but rather around $300-400 if parts are required such as ventor motors and gas
    valves. This year I had bad gas valve that retails for 399.00 and labour was about 150. Guess what that’s a few years of rental cost in one visit. Its not for everyone, but I don’t think it’s a scam. A contract is a contract. You don’t have to sign it. You don’t have to rent. But if you want out. Remember, Its a contract there will be a penatly.

  24. I am in the same situation. I have a copy of my terms and it states can have removed for the $75 fee if I don’t want to buyout. I called them and they are trying to tell me that terms agreement doesn’t apply to me. But I have this agreement how can they say it doesn’t apply and they want over 800 buyout fee for 7 year old water heater. This is outrageous. I have filed a complaint but am becoming truly irritated. Any help please would be truly appreciated.

  25. I’m going to start calling the rental company (Enercare) at least once a month, complaining about my hot water not being hot enough (even though it is)…How much will this end up costing Enercare to fulfill their service agreement; make it cost them more than it costs you per month. Maybe they’ll get fed up and offer to cancel ?

  26. I just went to Enercare to buyout my water heater that was installed in June 2016. Based on the on-line 2017 buyout schedule on their website, the price indicated was $1055.00, but was quoted $1352.00 from Enercare customer service. After escalating the price difference to the manager, I was told the on-line price was for tanks installed in 2017 only, and I was covered under the April 1/2015 terms and conditions for my 2016 tank, but he could not produce any buyout schedule for June 2016. The only other buyout schedule on-line is for after July 1/2015, which is even cheaper($940.00) to pay off. Their argument that an older 2016 tank costs more than a newer 2017 tank to buy off does not make sense, and the consumer has no way of fighting it.

  27. Enercare sent me a letter stating that they had screwed up and have not been charging me for rental for the last 18 months. They now want $800 in back rent. I told them I wouldn’t pay it, if I made a mistake they would have me pay a penalty so shouldn’t they as well? By the way there are more than 50 homes in my sub division that got the same letter. I then asked how much to buy it out. Over 2k. I told them they were thieves and that I can buy one for $700 at home depot. I told them to come get it and they told me that terminating the contract will cost me over 3k.

  28. Milan
    Here’s my story , very similar to all the rest . Called to inquire re cancellation so that i can save some money towards my children’s university funds. Sorry , but we cant do anything , you have to buyout the unit , cost was over 1100$, as per the contract which you signed . The agreement is on our website if you want to read it , or if you want us to get you the original signed contract we could do that , for a fee though , its not free !
    Wait a minute , when we moved in we naturally assumed the contract of that unit , but it broke down and guess what , their servicemen who are told to do this , told us we should get a new one at NO extra cost to us ! But no one ever said anything about a 16 year contract ! They just tell you to sign for the new one . Shame on them . It’s not like everyone wants out or can even afford to buy a new one . Some people prefer the monthly option , some dont , so why cant they be fair ? It’s all about the money . Their website speaks to ethics and honesty , what a joke . How can the shareholders continue to put up with this knowing that a major suit is on its way and that could cost them millions . I’m still waiting to hear from them on their final offer , if its not anything but complete exit from the contract , i too will file with the government seeking compensation .

  29. I would like to share my story. I bought a pre-construction condo which took 5 years to built. At occupancy I was given a rental agreement to sign from Enercare. For a tankless water heater and boiler the rental fee is $68+hst per month. If l wish to buy it out it would cost me $6000+. Those were the options on the agreement. For me to rent it at$68 per month I would be paying double over the span of 15 years. I guess they put a high price tag on the buy out option so I would go with the rental route. What Enercare did was they gave the rental agreement directly to me rather than giving it to my lawyer to read through it like they are supposed to. I feel trapped! Don’t know what to do….

  30. I rented Furnace and AC from Ener Care and the water heater was already there when we bought the house a couple of years ago. I was given the option of financing or renting, and I choose renting because of the “peace of mind” since you do not have to worry about maint. costs. I called them today to ask about cancellation fee and was told that the only option I have is to buy out. So I read the whole contract NOW and it does say I can not cancel after 30 days. I feel ripped off because I trusted the rep. who sold the contract. The whole point to choose renting vs financing was that we could cancel at any time and he told us about the buy out option, but it was an OPTION!!
    What a scam and a lie.

  31. Hi Joel,

    This is the point: it’s not “unfair rental contract”, it’s actually violation of anti-competitive law which Competition Bureau had already enforced. It’s a complaint to Competition Bureau that Enercare does not obey what Competition Bureau already proved. They have to look and resolve each case, not only take complaints. What’s the purpose of Competition Bureau then? Don’t let them close your complaint (they must ask if they can) without resolution which satisfies you completely – in this case they should do something about your particular case.


  32. Trueler, Thank you for writing this article. Enercare is taking advantage of people and these rental contracts pretty much define anti-competitive practices.

    Here is an update from my previous post.

    I submitted a complaint to the Competition Bureau and they contacted me. I learned that the Competition Bureau does not resolve individual cases but takes complaints from many customers, then seeks resolution through enforcing new business practices. So everyone who is frustrated with their unfair rental contract should file a complaint with the Competition Bureau.

    The Better Business Bureau is a not for profit that tries to resolve complaints between customers and companies. However they do not have any legal authority to force a company to any action. I have found that since all you can do is file a complaint, Enercare may try to close your case by giving you a very small discount on your buyout, but they will not let you terminate your contract any other way.

    I feel like the only way to not pay the ridiculously high buyout (Rental Cancellation Fee) is to prove that that is what it is in court or some legal action. I feel like this may not be as simple as showing what the retail value of the hot water heater and how the buyout price is substantially higher. Enercare posts their buyout prices online so I feel like they could use this to say these are their posted prices you agreed to in the contract.

    I don’t know how to move forward with this other than pay the buyout. I am open to suggestions.

  33. @Ben: Thanks for your feedback! Please start complaint to the Competition Bureau. This practice is against the law

  34. I have the same problem with them, just got a place in Ajax, living by myself . I didn’t want an 50 gallon tank and the rental fee. I called them regards the cancellation. They need me to buyout which ask for $1500 for a 3 years old tank. I could of buy a new one and install wonldnt cost that much. It just doesn’t make sense to me that we need to buyout something that we don’t want. These company are robbery . Has anyone successfully beat their system? Thanks I would love to get more info on that

  35. I am also stuck in this rage-inducing situation. In 2015 I bought a house from Claridge, and the tankless hot-water heater was “assumed” in the contract, even though I was never shown nor provided with a contract outlining the rental cost and conditions with the scammers at Enercare at the time of our house purchase. How the hell is this even legal?

    I have been paying $45 a month for a little over 18 months now for a unit that retails for about $2000 after tax, which means I’m already out over $800.

    Let’s assume a few hundred for installation – $2300. At $45 / mo that would be paid off in about four years, but you’d still be stuck paying this perpetually. Assuming a 10-15 year lifespan, you could feasibly pay it 2-3 times before having to replace it. Even with the occasional service call, renting just doesn’t make sense.

    When I called last summer to enquire about the buyout after finally receiving a copy of the extremely lopsided and unfair bs contract that I’d never seen, I was quoted a ridiculous $3500. It’s now about $3200. If I do the buyout next month I’ll have paid almost $4000. I won’t be ahead for having done the buyout for another 8 years.

    It is absolutely infuriating that they are getting away with this, and I wish this would gain momentum so we could file a class action.

  36. Thanks Joel. Please tell us when you have a resolution from Competition Bureau. It’s still outrageous anti-competitive practice from Enercare


  37. I contacted Enercare to end my hot water tank rental contract. They informed me that I must pay the buyout fee. The buyout fee was more than twice the price of a brand new hot water tank at Home Depot with a 6 year warranty. I mentioned this is a violation to the Canada Competition Act and that Enercare had said that they would not continue the anti-competitive practices. The manager on the phone said they do not negotiate buyout prices and there was nothing he could do. I have submitted a complaint with the Competition Bureau. Hot water tank rentals are a scam, and Enercare is stealing money from innocent people.

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