How much energy credit is acceptable?

concrete_kid

Hi

I am £200 in credit with my dual fuel energy account. It's just before winter so I imagine It's a good idea to have some credit, but is this too much? We pay £90 a monthy DD, and give regular metre readings which were last given in July.

Thanks

jamesperrett

At the time I left Ovo last year I was over £500 in credit. This was down to their policy of charging in advance (even after the stopped supplying us) rather than other companies who charge in arrears. Fortunately they also offer 3% interest on all credit balances.

Andy_WSM

£200 credit on a £90 a month DD certainly isn't excessive.

What if we get a Daily Express type Winter (highly unlikely!)?

We may get another mild one, in which case it's more than enough.

I'd let it roll and review things in the Spring.

matelodave

I would have thought that about £200 was the optimum to go into winter.

Unless you know what your consumption is in kwh you won't really know whether you've got enough credit especially if your bills have been estimated.

We are about £230 in credit at the moment and I expect that it will just about balance out next April when our contract expires. In the summer we use about £30 a month and in the winter it can go up to £150/month or more especially if it gets everso cold. We pay £80 a month and so far we've been lucky that our supplier (FU) hasn't started mucking about with the DD amount.

daveyjp

No credit is acceptable, unless interest is paid. Credits are for bank accounts.

matelodave

Then you have a variable direct debit - ie you pay for what you use every month.
If you want to average it out over the year then at some time you'll be in credit and some of the time you'll be in debit. If you take charge of your bills then you can control the optimum to minimise either.

Nada666

daveyjp wrote: »

No credit is acceptable, unless interest is paid. Credits are for bank accounts.

I would say six percent (typical direct debit discount) is phenomenally high interest for a risk free investment.

jbuchanangb

I joined FU in June and a credit balance has built up with my £89 pm DD. It will be at £290 before the October bill comes in, but I agree with Andy_WSM, and I'm going to let it roll round until May and see how it turns out.

Ideally you should start a new contract with a supplier in October so that build up a debit with them, and repay them the following year, but I was with nPower and just had to get out!

matelodave

If you start a new contract in October you are likely to have your direct debit increased in the new year if you've started to ramp up significant debt if you are with a company that demands regular meter readings.

Ideally it shouldn't make any difference to what time of year you start a contract but it's up to you to make a reasonable estimate of your annual consumption and make sure that your direct debit will cover it over the 12 month period. Monitoring your own consumption and checking bills should ensure that it balances out and avoid any nasty surprises.