Martin Lewis: Do you pay energy by monthly direct debit? Three urgent must-knows before 1 April

pochase

Have you just come of a fixed deal?
And is your account maybe in debt?
Have you agreed to go onto a new fixed deal?

250% sounds a lot, but if you have been on a fixed deal an increase of more than 100% for electricity and more than 200% for gas are very possible going onto the standard variable tariff, but to get to 250% total increase it sounds like either a high debt on the account, or you went onto a fixed deal with very high prices.

Can you please let us know 

old KWh price for electricity
old KWh price for gas
new KWh price electricity
new KWh price  electricity
use for gas and electricity the last 12 months
debt or credit for your account
old and new direct debit

Marchantmike

Interesting that EDF site is down for maintenance today, so can't submit any readings 

Ultrasonic

Marchantmike said:

Interesting that EDF site is down for maintenance today, so can't submit any readings 

It was just down at the time you tried due to issues with high demand. Try again later. All suppliers are unsurprisingly having issues today.

fallen121

I have to ask why Martin is campaigning so hard for people to stay on DD? He cheerfully admits that some energy companies are hiking DDs by more than the 54% average increase in the price cap (to "cushion themselves") and that if that happens customers should phone to complain. Great idea, except that it takes on average an hour or more to get through to a utility company on the phone and usually you then get someone whose command of the English language is pretty poor. Why put yourself in a situation where you have to complain in the first place?

I personally would prefer to pay on receipt of bill and pay a higher price. At least you're paying for what you're actually using and not for what a company THINKS you might use, which is always over inflated as evidenced by the fact that 99% of those paying by DD are in credit, not the other way around.  I know there are companies that pay interest on the first £500 of credit balances, but isn't anyone else horrified that you would get into a situation where you have overpaid for something by the order of hundreds of pounds? If your groceries at Tesco came to £25 and they took £45 "in case you buy more than this next time" wouldn't you be rightly horrified? How come it's ok for utility companies to regularly do this without anyone batting an eyelid but if your local Council took more Council Tax "because it might go up next year" you'd rightly tell them to take a hike, right?

With interest rates as they are, you could and should be using that £500 to pay off your 23% APR credit card, not earning a paltry 1% credit interest or whatever these companies are paying.

Let's get back to the estimated utilisation. Most of us will be trying to use less. Which means for those of us paying as we use energy, we should be able to keep those bills under control. But in addition to the price cap, some companies are hiking customer's DDs not just on the basis of the price cap, but on the basis that they have estimated that they will use MORE energy. Where is the justification for this?

There's also this business of the 3 monthly bills. Bristol Energy, the company I was with until they went bust earlier this year, requested meter readings once a month, you submitted these online within 5 days of the email and then your bill was issued 3 days after that. Monthly billing for pay on receipt of bill customers. But the other utility companies have to bill pay as you use customers every 3 months WHY? Because it's more convenient for them, that's why. Don't let them fool you. They don't WANT you to pay on receipt of bill they want you to pay by DD. So they'll make it as deliberately complicated and difficult as they can.

I'm sorry Martin, I'm not convinced. You can stick your 6% where the sun don't shine. And I'm very VERY suspicious that you are campaigning so hard for DDs because someone somewhere is putting pressure on you to do so. People are abandoning DDs in droves and now suddenly you're putting out a video urging them to "think twice?". Don't make me laugh. Someone is panicking big time because consumers have woken up to the biggest scam of the century. 

london21

Galileo_Figaro said:

I'm a bit confused. Bulb have failed to produce a bill since January and have made ridiculously high estimates. I spoke to them and they recommended cancelling the direct debit until they sort it out. I asked and they said I wouldn't pay more from paying on rexroth of a bill rather than direct debit. Did they advise me incorrectly?

I am also with Bulb, what I have done now is i pay only what i use not estimates. I have a smart meter, they will deduct 10 days after billing period. This was no more random estimates and large credit balances. 

RogerBareford

fallen121 said:

I have to ask why Martin is campaigning so hard for people to stay on DD? He cheerfully admits that some energy companies are hiking DDs by more than the 54% average increase in the price cap (to "cushion themselves") and that if that happens customers should phone to complain. Great idea, except that it takes on average an hour or more to get through to a utility company on the phone and usually you then get someone whose command of the English language is pretty poor. Why put yourself in a situation where you have to complain in the first place?

I personally would prefer to pay on receipt of bill and pay a higher price. At least you're paying for what you're actually using and not for what a company THINKS you might use, which is always over inflated as evidenced by the fact that 99% of those paying by DD are in credit, not the other way around.  I know there are companies that pay interest on the first £500 of credit balances, but isn't anyone else horrified that you would get into a situation where you have overpaid for something by the order of hundreds of pounds? If your groceries at Tesco came to £25 and they took £45 "in case you buy more than this next time" wouldn't you be rightly horrified? How come it's ok for utility companies to regularly do this without anyone batting an eyelid but if your local Council took more Council Tax "because it might go up next year" you'd rightly tell them to take a hike, right?

With interest rates as they are, you could and should be using that £500 to pay off your 23% APR credit card, not earning a paltry 1% credit interest or whatever these companies are paying.

Let's get back to the estimated utilisation. Most of us will be trying to use less. Which means for those of us paying as we use energy, we should be able to keep those bills under control. But in addition to the price cap, some companies are hiking customer's DDs not just on the basis of the price cap, but on the basis that they have estimated that they will use MORE energy. Where is the justification for this?

There's also this business of the 3 monthly bills. Bristol Energy, the company I was with until they went bust earlier this year, requested meter readings once a month, you submitted these online within 5 days of the email and then your bill was issued 3 days after that. Monthly billing for pay on receipt of bill customers. But the other utility companies have to bill pay as you use customers every 3 months WHY? Because it's more convenient for them, that's why. Don't let them fool you. They don't WANT you to pay on receipt of bill they want you to pay by DD. So they'll make it as deliberately complicated and difficult as they can.

I'm sorry Martin, I'm not convinced. You can stick your 6% where the sun don't shine. And I'm very VERY suspicious that you are campaigning so hard for DDs because someone somewhere is putting pressure on you to do so. People are abandoning DDs in droves and now suddenly you're putting out a video urging them to "think twice?". Don't make me laugh. Someone is panicking big time because consumers have woken up to the biggest scam of the century. 

Well firstly it's not much of a scam to pay into an account which has an increased balance in the summer to make up for extra usage in the winter. No matter how much someone is in credit they arn't losing that money and they can request any extra credit back.

This works well for a lot of people because many people are simply bad at budgeting so a fixed monthly amount makes it far easier for them and they would struggle with increased bills in winter otherwise.

I personally pay for what i use each month and as i pay by variable direct debit it doesn't cost any more than a fixed monthly direct debit. This is with British Gas and other suppliers offer this too so it wasn't unique to Bristol Energy doing it this way.

But paying 6% to pay on receipt of bill is quite frankly a bit silly, why pay more for something when you don't need too.

pochase

Lets assume your direct debit is 100£ pm, while you bill is only 80£ in summer, 120£ in winter, with a total of 1200£ for the year.

So you don't want to build up your credit and give the energy company the interest free credit, which is only the case for a few month building up in summer, and decreasing in winter.

Are you really happy to pay 6% more on the 1200, which is 72£, while the average amount in credit over the would be 60£ if you pay by direct debit, which is not even lost. (Example May to October building up to £120, decreasing from November to April back to 0)

Wolfsbane2k

I'm struggling with the what to do here... my supplier has given me an estimated bill that's "quite" a lot higher than the actual reading for both gas and electricity... 

Mstty

Wolfsbane2k said:

I'm struggling with the what to do here... my supplier has given me an estimated bill that's "quite" a lot higher than the actual reading for both gas and electricity... 

Take a photo of your meters or smart meter and call them or put your actual meter readings in online👍 they will produce a new bill for you

QrizB

Wolfsbane2k said:

I'm struggling with the what to do here... my supplier has given me an estimated bill that's "quite" a lot higher than the actual reading for both gas and electricity... 

They'll probsbly recalculate when you give an actual reading, so best to give one sooner rather than later?