E.on wants to double my monthly direct debit

Penn_Wooding

There are two people living in my house, my mother and I. I've been paying £130 a month direct debit to e.on. However, I received a letter this morning telling me they want to increase my monthly payment from £130 up to £264. It says my balance is £676 which is what I assume is what I owe? Even so, more than doubling my monthly direct debit seems excessive and to be quite honest I'm not happy about it at all. I don't understand how we can possibly be using this much energy.

Should I get a recalculation because I'm not having them double the amount and then in six months time they've got loads of my money sitting in their bank account.

Browntoa

Are you giving them regular meter readings ? (I do monthly readings)

If not then your previous standing order may have been covering what they thought was your usage on their estimated readings , they have only spotted the debt build up when a proper reading was done

Robin9

THis could be your supplier adjusting the DD to ensure your account is in balance at the end of the fix.

Have a look at your accounts and see if the readings used are E for estimated rather than A for actual.

Read your meter now and post this and the last reading from your supplier.

When did you last switch supplier?

PennineAcute

The much colder than usage winter has caught out many a person.

Like others have said, have your bills been issued with estimated readings and your last bill an actual reading.

Saying that, £130 a month seems a lot, so even if all your bills have been on actual readings, you need to work out what is running up the meter.

Penn_Wooding

It doesn't make clear whether I'm in credit or not. "It just says this includes your current balance of £676.77. If you have a credit balance, this could be less than how much we think you'll use"

Even so, doubling my direct monthly payment is in my opinion completely absurd. That's an extra £1600 a year.

I'll have to check and see what's going on. I'm disabled so it's very difficult for me to actually look at any readings. I know that we used extra heating, but I just cannot believe that we've used this much. And as for electricity, I've only got a small electric fire in the main room I use on a daily basis, I haven't even got central heating.

molerat

They will be collecting the extra for a short period - probably 6 months - to bring the debt down then will come down to the correct payment. On demand electric heating is one of the most expensive ways to heat, I can heat my whole house 24/7 plus hot water with gas for the same price as a one bar electric fire 24/7 so that puts some perspective on it.


If you have not been supplying regular monthly readings then it is likely this bill is a catch up at the spring reconciliation time. You really need to supply monthly accurate readings and ensure all bills are to those readings, it stops nasty surprises like this. E.On have a very good on line account management where you can change your DD, you really need to be more proactive managing your energy account.

System

Penn_Wooding wrote: »

It doesn't make clear whether I'm in credit or not. "It just says this includes your current balance of £676.77. If you have a credit balance, this could be less than how much we think you'll use"

Even so, doubling my direct monthly payment is in my opinion completely absurd. That's an extra £1600 a year.

I'll have to check and see what's going on. I'm disabled so it's very difficult for me to actually look at any readings. I know that we used extra heating, but I just cannot believe that we've used this much. And as for electricity, I've only got a small electric fire in the main room I use on a daily basis, I haven't even got central heating.

As others have suggested, you need to check your recent statements. A credit/debit balance is only accurate on the day that the charges were raised with the caveat that the reading used must not be estimated. It follows that the first thing to do is read your meter and pass the reading on to your supplier. Ask them to produce an amended bill. You can then work out whether the revised DD amount is reasonable.

Two further points. It has been a cold winter. An electric fire can cost more to run than central heating. Secondly, do not worry about your credit balance. All credit balances are now fully protected by Ofgem in the event of a supplier default.

zagfles

Have you switched to them recently, like in the last 6-9 months or so?

Most suppliers seem to pull this trick of initially setting a DD which reflects likely average use, but then wanting to recalculate before the year is up at a time like now, ie the spring, when you'll have a debt caused by their initial setting of the DD.

System

zagfles wrote: »

Most suppliers seem to pull this trick of initially setting a DD which reflects likely average use, but then wanting to recalculate before the year is up at a time like now, ie the spring, when you'll have a debt caused by their initial setting of the DD.

I beg to disagree. If consumers use the various icons (2/3/4 bed etc) on a supplier!!!8217;s website, then suppliers will base the cost of annual energy on tables produced by Ofgem (TDCV). This is at best a guess.

https://www.ofgem.gov.uk/gas/retail-market/monitoring-data-and-statistics/typical-domestic-consumption-values

However, if the consumer enters projected annual consumption in kWHs/year for both gas and electricity, then the annual cost and monthly DD payment will be based on these consumption figures. This applies to both suppliers!!!8217; websites and PCWs.

matelodave

Regularly reading your meter and making sure that bills do actually reflect your consumption will make you a bit more aware of what you are using and will help prevent wild swings in direct debits.

As others have said, if you've not had your meter read for a time and have been getting estimated bills (usually denote by an E next to the meter reading) then it's easy to ramp up arrears.

You should get an accurate up to date meter reading and check your bill to see if it's anywhere close. If it's not then send in the reading to your supplier and request that the bill is corrected.

You might even be in credit, but you won't know unless you do your own sums and work out what you've used since the last bill, based on an ACTUAL readings (usually shown with an A beside the reading), your tariff and how much you've paid them.

zagfles

Hengus wrote: »

I beg to disagree. If consumers use the various icons (2/3/4 bed etc) on a supplier!!!8217;s website, then suppliers will base the cost of annual energy on tables produced by Ofgem (TDCV). This is at best a guess.

https://www.ofgem.gov.uk/gas/retail-market/monitoring-data-and-statistics/typical-domestic-consumption-values

However, if the consumer enters projected annual consumption in kWHs/year for both gas and electricity, then the annual cost and monthly DD payment will be based on these consumption figures. This applies to both suppliers!!!8217; websites and PCWs.

Err...you're missing the point. The point isn't the annual usage turning out to be incorrect. The point is suppliers seem to set a correct DD based on average usage, but want to recalculate before a year is up, usually in the spring, without accounting for the fact that usage will be lower in the summer.

I've been switching suppliers practically every year for a good few years now. Mostly, have switched in the autumn, and used 1 year fixes.

Invariably, what seems to happen is:

I give an accurate estimate of my annual usage. They set a DD accurately based on that annual usage.

Come the spring, they notice I'm in debt (duh, really? who'd have thought I might use more than average in winter?), and want to recalculate based on my annual usage plus the debt at that point.

I always reject this, since usually I'd switch at the end of the fix and so don't want to build up credit with them. Usually they back down. If they want the account to balance in the spring, and you join in the autumn, they shouldn't have set a DD based on average annual usage, they should have set a DD based on winter usage.

Being a cynic I suspect the reason for this is they can advertise misleadingly low initial payments, eg join us and your DD will be (annual usage*tariff/12), whereas if they want account balance in spring they should be setting the initial DD at a much higher amount than this to account for higher winter usage.