fixed tariff

eyesofbrown

I fixed my tariff with British Gas 3 months ago so imagine how shocked I was when my direct debit had doubled in price. I contacted British Gas who informed me that even though I had fixed my tariff that only the tariff had been fixed and not the monthly direct debit. I would have thought that if the tariff had been fixed then the monthly direct debit would not increase. Can anyone shed any light on this!

Mugget

A fixed tariff is fixed unit price not a fixed DD . Your DD will always vary depending on your usage. A common misconception by people swapping and changing suppliers and what some suppliers do imply o try and gain customers

TIMMY85

I often use a supermarket analogy when speaking with customers as it is an everyday example.
If tesco offer you the option to fix your milk cost at 50p a pint and you usually buy a pint a day your expected cost for milk would be £3.50 a week no matter what happens to the cost of a pint of milk.
If after six months you now use two pints of milk a day your cost will be £7 per week as you use more. The cost of the milk has not changed.

jalexa

eyesofbrown wrote: »

I fixed my tariff with British Gas 3 months ago so imagine how shocked I was when my direct debit had doubled in price...

Doubled in price when? And from who's initial figure?

While as others have pointed out its the rate not the DD which is fixed, it's not a gimme that British Gas have accurately and reasonably calculated the monthly payment.

chris1973

I would have thought that if the tariff had been fixed then the monthly direct debit would not increase

Energy companies will not gift you free energy, so if you use more you pay more. Did you honestly think you had basically unlimited, uncapped energy usage from your current monthly direct debit payment?

All the fixed price does is fix your per unit price, the cost of each unit used, it doesn't guarantee you an unlimited number of units to use. British Gas are not an 'All you can eat' energy provider!, in fact non of them are.

So if you have a fixed price of 13p per unit then you will pay 13p per unit for the duration of the fixed price.

So if you consistantly use around 500 units at 13p every month then you will pay a monthly DD of 13p x 500 = £65.00 per month and your DD will be set up for £65 a month accordingly, in relation to your energy usage records over the previous months / years, or that of the previous occupier if you have recently moved in.

However, if they notice your consumption changes from 500 units to 800 units per month for a couple of months then you will then be using 13p x 800 = £104 a month so your DD will be changed from the original £65 a month to the new £104 a month to cover your changing consumption

In each example however the unit cost remains at 13p, this is what British Gas are fixing, the unit rate, not how much you will pay to them for the total energy used each month, that is controlled by you and what appliances you use.

dogshome

Hi eyesofbrown - Lots of posts telling you how the D.Debit/Annual Cost system works, but no shame in being a learner driver, we all were once

To challange BG's new D/D demand, you have to do the homework to establish your Annual consumptions of Elec & Gas in Kwh - If you were with BG in the year up to you going onto their Fixed tariff, ask BG what your consumptions were in the previous year, (They may well be listed on a recent bill ) - If not look at the bills from your previous supplier and do your best to work out what you used over 365 days.

Once you have these figures, apply them to your BG fixed tariff and taking into account any discounts, work out the Annual cost, divide by 12 and round the answer up to the nearest £ to find what your D/D should be.

If it's less than BG are asking for, Email BG heading it Complaint, with your figures

jalexa

dogshome wrote: »

Once you have these figures, apply them to your BG fixed tariff and taking into account any discounts, work out the Annual cost, divide by 12 and round the answer up to the nearest £ to find what your D/D should be.

Good post, but you also need to factor in the current account balance, whether that be in debit or credit, and the time to the next "annual review".

macman

Exactly. It would appear that your account is in debit and your existing DD is not covering current consumption and the monthly payback required to clear the debt.