Paying by monthly direct debit - some questions!

herman2811

Apologies in advance as I'm sure the answer to my questions are really obvious!

After doing some searches on comparison sites like uswitch, I think I'm going to change my supplier of gas and electric.

Cheapest I've found is EDF's online Tariff version 5 - on this you have to pay by monthly direct debit. Until now I've always payed at the post office on receipt of a quarterly bill.

I'm aware they say that paying by monthly direct debit works out cheaper, but I'm unsure how this works? Do they take the same amount every month, and at the end of the year they debit or credit your account depending on exactly how much you actually use? If this is the case, how do they set the monthly figure?

I guess I'm also concerned that they might automatically take stupidly high amounts out of my account, as when I moved house (about 5 years ago), some of my new bills were ridiculously high!

Any information/advice would be much appreciated!

jd87

They take the same amount every month and at first they will set the amount by estimating your usage based on things like how many people live there, how big your property is, etc. The amount is fairly negotiable, so if you think the amount they want to take is too much you can ask them to reduce it a bit. If you don't pay enough, then when they come to review your account (usually after 12 months), they will increase your direct debit to pay off the debt and keep up with your future usage, so it is always best to pay too much initially until things settle down and you can figure out exactly how much you use.

In the summer, when you don't have lights or heating on as much, it is normal to build up a large credit, and in winter it is normal to eat back into this credit as you use more energy.