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energy price increases

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I am on a fixed price deal with British gas and mid term they have increased my payments. they tell me it is only the standing charge that is fixed and they can increase my payment every 6 months. Is this right.
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  • [Deleted User]
    [Deleted User] Posts: 35,242 Forumite
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    The DD can be changed regularly, but the rates will remain the same if it's a fixed tariff.
  • MWT
    MWT Posts: 9,291 Forumite
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    dodger83 said:
    I am on a fixed price deal with British gas and mid term they have increased my payments. they tell me it is only the standing charge that is fixed and they can increase my payment every 6 months. Is this right.
    The price per kWh and the daily standing charge are fixed, but the DD can change in line with your estimated use, so that part is not fixed...
    Check what they are estimating your use to be and make sure that is rational...

  • Astria
    Astria Posts: 1,448 Forumite
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    Yes, they are increase your payments at any time, particularly if you are using more energy than they estimated.

  • Robin9
    Robin9 Posts: 12,149 Forumite
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    dodger83 said:
    I am on a fixed price deal with British gas and mid term they have increased my payments. they tell me it is only the standing charge that is fixed and they can increase my payment every 6 months. Is this right.
    Do you know what the original estimate of annual use was ?  Are you now using more ? -   you can calculate yourself , you just need an actual reading of about 12 months ago and todays reading

    PS If you used less that review would result in your DD going d
    Never pay on an estimated bill
  • [Deleted User]
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    dodger83 said:
    I am on a fixed price deal with British gas and mid term they have increased my payments. they tell me it is only the standing charge that is fixed and they can increase my payment every 6 months. Is this right.
    If you are on a fixed rate tariff then the contract term; the standing charge and the unit rate are fixed until the end of your contract. Fixed term contracts are not ‘all you can consume’ for a given monthly payment deals.

    It works like this: you sign up to a contract with an annual cost of £1800/year based on an assumed rate of usage in kWh/year.  The supplier has an algorithm that breaks down your assumed monthly usage into percentages: clearly the percentages change each month and will be higher in the Winter in the Summer.

    At the 6 month point, the computer looks at your actual percentage usage and compares it what was predicted when your plan was set up. It recalculates a revised annual usage and an annual cost.

    Let us say that your revised annual cost increases to £2100: the supplier needs to recover a further £300 over the coming 6 months to achieve a zero balance at the end of your fixed term. Your monthly DD payment increases from £1800/12 or £150 per month to £150 + £300/6 or £200/month.

    What I have posted above is not an exact science and it is much more difficult when consumers are on a variable tariff in a changing price situation.
  • macman
    macman Posts: 53,098 Forumite
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    It's not an 'all you can eat' deal...
    No free lunch, and no free laptop ;)
  • EssexHebridean
    EssexHebridean Posts: 21,482 Forumite
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    dodger83 said:
    I am on a fixed price deal with British gas and mid term they have increased my payments. they tell me it is only the standing charge that is fixed and they can increase my payment every 6 months. Is this right.
    Several things to unpick here I think. 

    They've increased your payments - is explained by others above. Legitimate so long as the estimated annual consumption they've based it on is accurate - as already said, this is easily checked yourself. 

    The statement that "only the standing charge is fixed" is something you may want to check on - a standard fixed rate tariff will have fixed standing charge AND unit rates. 
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  • dunstonh
    dunstonh Posts: 116,696 Forumite
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    dodger83 said:
    I am on a fixed price deal with British gas and mid term they have increased my payments. they tell me it is only the standing charge that is fixed and they can increase my payment every 6 months. Is this right.
    When you bought the deal, did you give them your annual kWh use or did you go by a monthly payment amount?
    If you gave the kWh then the direct debit amount should be set to cover that.    if you gave them a monthly amount then its probably wrong and would need adjusting once they see what your actual use is.


    I am an Independent Financial Adviser (IFA). The comments I make are just my opinion and are for discussion purposes only. They are not financial advice and you should not treat them as such. If you feel an area discussed may be relevant to you, then please seek advice from an Independent Financial Adviser local to you.
  • pochase
    pochase Posts: 3,449 Forumite
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    dunstonh said:
    dodger83 said:
    I am on a fixed price deal with British gas and mid term they have increased my payments. they tell me it is only the standing charge that is fixed and they can increase my payment every 6 months. Is this right.
    When you bought the deal, did you give them your annual kWh use or did you go by a monthly payment amount?
    If you gave the kWh then the direct debit amount should be set to cover that.    if you gave them a monthly amount then its probably wrong and would need adjusting once they see what your actual use is.


    Even if the estimated/given KWh were correct when the tariff were taken, they can change.

    Especially if the OP believed he had "all you can eat" energy and just used a bit more as it is free.
  • [Deleted User]
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    dodger83 said:
    I am on a fixed price deal with British gas and mid term they have increased my payments. they tell me it is only the standing charge that is fixed and they can increase my payment every 6 months. Is this right.

    The statement that "only the standing charge is fixed" is something you may want to check on - a standard fixed rate tariff will have fixed standing charge AND unit rates. 
    It was previously the case that discounts for paying by DD and dual fuel led to a reduced standing change. It follows that if a customer cancelled their DD payment, the standing charge could increase slightly. The ‘bottomline’ is that these things are noted in the contact terms and conditions that very few people ever bother to read.
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