Octopus staggering energy price rise emails

mickstatham

Hi all,

this is actually on behalf of my sister. She is currently with Octopus and her first year contract is comment to an end. She was unsure when this was due to end so called them. On the back of this conversation they sent her three email quotes for a new Octopus fixed term contract.

To her astonishment they want to increase her payments by 140% to 190% depending on which of the three quotes she chooses. Of course she is now panicking, and rightly so. She is a pensioner and can't afford this sort of price rise.

Her existing contract ends in April and she currently has a yearly bill of around £1400, paying about £128 per month and is £450 in credit. The quotes are for £3560, £4268 and £4352 per year respectively.

By my calculations they have overestimated her KWH usage by almost 7,800 KWH for gas and 350 KWH for electricity. Her current bill shows an expected yearly bill of £1470, which I calculate to be fairly accurate.

I understand that energy prices have, and will continue to increase but this seems excessive. Has anyone else had this happen to them. We are at a loss as what to do about this. The rise is far in excess of the 50% increase predicted for the April rise.

Thanks everyone.

MSE_ForumTeam5

We've moved this to the Energy board

TheMilkmansDad

What are the tariff names and what are the prices? the 50% increase is on the Standard tariff and not the fixed tariff you were on (which would be substantially over your fix i'd have thought)

bagand96

mickstatham said:

I understand that energy prices have, and will continue to increase but this seems excessive. Has anyone else had this happen to them. We are at a loss as what to do about this. The rise is far in excess of the 50% increase predicted for the April rise.

The problem is that the currently reported "50% rise in April" is based on the current Ofgem price cap, to the expected new cap in April.  However anybody who's currently on a fix about to run out, or due to run out before April is likely paying rates below the current cap.  So they will see a price rise to the current cap level, and then another when it's revised in April.  Many will see bills double - this is a point that the "50% rise" headlines are missing

A couple of points specific to the situation:

- think in terms of the kWh rate and daily SC rate.  What is she currently paying and what have Octopus offered?
- she doesn't have to choose a new fix now she can wait and see what happens, and her current fix takes her upto April anyway
-  the reason the new proposed DD rates are so high is they're based on an expected consumption that you say is too high. Has your sister been providing regular meter reads? Are her bills based on actual reads? 
- Octopus allow you to set your own DD so you don't have to accept their proposed DD figures

mickstatham

TheMilkmansDad said:

What are the tariff names and what are the prices? the 50% increase is on the Standard tariff and not the fixed tariff you were on (which would be substantially over your fix i'd have thought)

Hi, thanks for reading.

The tariff names are:





sorry about the screen caps, 

mickstatham

bagand96 said:

mickstatham said:

I understand that energy prices have, and will continue to increase but this seems excessive. Has anyone else had this happen to them. We are at a loss as what to do about this. The rise is far in excess of the 50% increase predicted for the April rise.

The problem is that the currently reported "50% rise in April" is based on the current Ofgem price cap, to the expected new cap in April.  However anybody who's currently on a fix about to run out, or due to run out before April is likely paying rates below the current cap.  So they will see a price rise to the current cap level, and then another when it's revised in April.  Many will see bills double - this is a point that the "50% rise" headlines are missing

A couple of points specific to the situation:

- think in terms of the kWh rate and daily SC rate.  What is she currently paying and what have Octopus offered?
- she doesn't have to choose a new fix now she can wait and see what happens, and her current fix takes her upto April anyway
-  the reason the new proposed DD rates are so high is they're based on an expected consumption that you say is too high. Has your sister been providing regular meter reads? Are her bills based on actual reads? 
- Octopus allow you to set your own DD so you don't have to accept their proposed DD figures

Hi thanks, as far as I know ( and her online account seems to back this up) she does provide reading every month. I have mentioned to her that she can 'wait to see what happens' and not accept and fix rate offers but I think the £3000 hike figure has freaked her out somewhat. From £1400 to £4300 is a huge increase. I'm trying to get her to speak to Octopus again, but she's 75 and a little unsure how to handle this. I may have to call them myself.

bagand96

Thanks for the tariff info. What is her actual annual use in kWh for both gas and electric? And what annual use have Octopus used in the quotes?

mickstatham

bagand96 said:

Thanks for the tariff info. What is her actual annual use in kWh for both gas and electric? And what annual use have Octopus used in the quotes?

As her first year doesn't finish until April this should be approx, by my calculations:
1,700 KWH for electricity
25,600 KWH of gas
up to 6th April 22 (when her contract ends).

(up to Januarys bill she's used: for electricity 1490 KWH and for gas 19,139 KWH)

Octopus are suggesting that she'll use:
2,027 KWH of electricity
33,372 KWH of gas

MWT

mickstatham said:

By my calculations they have overestimated her KWH usage by almost 7,800 KWH for gas and 350 KWH for electricity. Her current bill shows an expected yearly bill of £1470, which I calculate to be fairly accurate.

Keep in mind that she has another 3 months of high gas use to go before we get out of winter so depending upon how you are calculating that they have overestimated her gas use, they may not be as far out as you think if the annual total of £1470 looks fairly accurate...

That credit balance at the moment of £450 is probably going to be reducing over the next 3 months as well, and depending where she is in the cycle of payments and bills, it may be lower than that if another bill is due to be deducted before the next payment is due.

Right now though the best advice given her current fix does not expire until April, would be to do nothing and go onto the capped variable rate.

It is still going to be a significant increase for her, but her gas use from April onwards is going to be lower obviously.

The risk is that she may not be able to get a fix as 'cheap' as the current 'Loyal' tariff if she waits until April...

QrizB

mickstatham said:

This is actually on behalf of my sister. She is currently with Octopus and her first year contract is comment to an end. She was unsure when this was due to end so called them. On the back of this conversation they sent her three email quotes for a new Octopus fixed term contract.
To her astonishment they want to increase her payments by 140% to 190% depending on which of the three quotes she chooses. Of course she is now panicking, and rightly so. She is a pensioner and can't afford this sort of price rise.

The best fixed-rate currently on offer by Octopus is theyr "Loyal Octopus" deal, the third of your three screenshots. Compared to your sister's current tariff this is ~65% more expensive for electricity and ~195% more expensive for gas.

Her other option (not pictured) would be not to choose a fixed rate but to revert to the variable tariff. At 21p/kWh for electricity and 4.1p/kWh for gas that would be an increase of ~25% and ~45% respectively, but the Ofgem cap will be revised in April and variable tariffs are likely to rise towards the "Loyal Octopus" rates then.

Whatever she chooses, your sister has a significant price increase to look forward to.

QrizB

mickstatham said:

bagand96 said:

Thanks for the tariff info. What is her actual annual use in kWh for both gas and electric? And what annual use have Octopus used in the quotes?

As her first year doesn't finish until April this should be approx, by my calculations:
1,700 KWH for electricity
25,600 KWH of gas
up to 6th April 22 (when her contract ends).

(up to Januarys bill she's used: for electricity 1490 KWH and for gas 19,139 KWH)

Octopus are suggesting that she'll use:
2,027 KWH of electricity
33,372 KWH of gas

25,600kWh or 33,400kWh are both quite large amounts of gas and disporportionate to her electricity use. Is your sister's house particularly large, draughty and/or poorly-insulated? Is there some other reason for her to be a high gas consumer but a low electricity one?

Can you check that Octopus aren't accidentally billing her for an imperial (cubic feet) meter by mistake?