News: Energy bills to rise by £700/yr for many | Chancellor unveils up to £350 households support

MattMattMattUK

Sea_Shell said:

Does anyone know if there is an industry standard* surrounding how companies deal with persistent arrears (debit balance) on a DD credit account?

At what point would they usually INSIST on a DD being increased (rather than recommended), and if it isn't (or worst case, it bounces) at what point would they look to put the customer onto a pre-pay meter?

How far into a debit balance would they let people get - £100, £200 or more, before they'll take action?



* If not, what about Eon specifically?

From the experience of friends, they tend to insist as soon as their was debt at the end of a quarter, I know someone who was told by BG to accept the DD increase or they would be moved to prepayment, although BG had recommended increasing the DD multiple times before they insisted, when it was obvious that they would be in debt at the end of a quarter.

As far as I am aware there is no industry standard, or Ofgem guidance regarding this, my guess is that if the DD was at the level the energy provider recommended to cover annual usage then far less likely than if the consumer was keeping the DD at an unrealistically low level.

I am not sure in the current climate, with energy providers losing billions, that they will be particularly tolerant of consumers running up debts.

wrf12345

Wrong government but you could conceive of a situation where the the default buyer of gas and electric was the govn with prepayment meters linked to the national grid company, cutting out the myriad of energy providers who don't really do anything useful, saving 30-40 percent on the bill. Modern smart prepayment meters can be topped up online so no great hardship. There would be almost no overhead or cost for the govn as they could use existing personnel and offices.

Ofgem needs to make these prepayment meters cheaper than the credit meters as well as removing the standing charge from them, to reflect modern times and their potential to transform the industry for the consumer. That would be a first step. One reason the unit rate should be lower not higher, there are no debts to chase up as they are either in credit or reading zero (apart from a small amount of emergency credit).

Sea_Shell

Some good information here ...

https://www.citizensadvice.org.uk/consumer/energy/energy-supply/get-help-paying-your-bills/struggling-to-pay-your-energy-bills/


However, I'm sure they'll be many for whom even a payment plan won't be affordable... especially when all the other cost of living increases are factored in. ☹️

Also, how many direct £150 council tax rebates are just going to get sucked up by an existing overdraft?!

Sea_Shell

Also, separately, when will letters (emails) start arriving advising of the April cap, with increased DD requests (for those already on svt)

If someone is currently paying the bare minimum the supplier is currently allowing, are they realistically only going to get March's payment at this rate?

QrizB

Sea_Shell said:

Also, separately, when will letters (emails) start arriving advising of the April cap, with increased DD requests (for those already on svt)

I think that energy suppliers need to give 28 days notice of any increase in a variable tariff. We'll see the first letters hit the doorstep / inboxes in late Feb or early March.

wrf12345

It is "lucky" that it is post-winter when the rises arrive so DD can be scaled back from the 54 percent increase most companies will try to up them by as many get into credit over the summer in readiness for winter gas heating, part of which will be covered by the £200 loan in October and perhaps radically scaling back gas usage as well.

Personally, I am changing to a fixed tariff that has relatively low s/c's and cutting back further on electric to get my dd below what I am paying now and not going to bother with gas, just pay the £50 s/c. I may use a couple of solar panels, inverter and battery to really hammer the electric use down in the summer (cheap secondhand panels on their own AC circuit not grid-tied). There is no real saving in it, overall, but it is more two fingers at the energy companies until they sort themselves out and also useful if there are grid failures which can be expected with wild weather and spending cuts.

Sea_Shell

Sadly, for many the £200 credit could just end up settling any arrears on the account built up between now and October, so come then, they'll still have to find the full cost of next winter's energy. ☹️

Ultrasonic

Sea_Shell said:

Sadly, for many the £200 credit could just end up settling any arrears on the account built up between now and October, so come then, they'll still have to find the full cost of next winter's energy. ☹️

They will still be £200 better off than they would have been though. Plus an extra £150 for most as well.

Sea_Shell

Ultrasonic said:

Sea_Shell said:

Sadly, for many the £200 credit could just end up settling any arrears on the account built up between now and October, so come then, they'll still have to find the full cost of next winter's energy. ☹️

They will still be £200 better off than they would have been though. Plus an extra £150 for most as well.

I'm not sure they'll feel "better off", they just won't have quite as much debt. 

Many won't feel they have an "extra" £350 available to put towards their new higher fuel bills.

But yes, it's still better than not getting anything.

Ultrasonic

Sea_Shell said:

Ultrasonic said:

Sea_Shell said:

Sadly, for many the £200 credit could just end up settling any arrears on the account built up between now and October, so come then, they'll still have to find the full cost of next winter's energy. ☹️

They will still be £200 better off than they would have been though. Plus an extra £150 for most as well.

I'm not sure they'll feel "better off", they just won't have quite as much debt. 

Many won't feel they have an "extra" £350 available to put towards their new higher fuel bills.

But yes, it's still better than not getting anything.

I don't think making anyone 'feel better off' is the point, rather it's more about trying to make an upcoming bad situation feel slightly less bad.

I do wish the government was trying to do something much more targeted to those who most need help by the way.