£400 electricity payment from Oct 22

ElleLM

Eon have updated my monthly DD for new price caps starting 1st October 2022. According to media information the fixed £400 government payment to all households will be paid in six instalments from Oct- March of £66–£67pm. Why then has Eon spread the £400 payment over 12 months for calculating 1/12th DD payment?
Is this the way all energy companies will be paying the £400 effectively holding back £200 till after April?

lisyloo

You’d need to ask eon for their rationale,  but the idea of a fixed dd is that people pay a fixed amount to help with their budgeting.
the extra you’ve paid as a result of the discount will stay on your account just as it would with lower summer usage.

if you don’t like it then switch to variable DD (I’ve done this).
but do be aware you’ll have much higher bills over winter.

i don’t totally agree with the way companies estimate, but I accept its their choice.
its your choice whether you want to go fixed or variable.

LindsayT

What makes you think they are spreading the £400 over 12 months?
If this was the case, I would have expected posts from other people about this but I haven't seen any.

molerat

There's 2 things in play here, DD increase due to price increase and the £400 rebate. Your DD should increase to 1/12th your annual use ignoring the rebate and the rebate should then be paid.  Have you been told how your supplier is processing the rebate? Is this Eon or Eon Next ? 2 different suppliers

lisyloo

molerat said:

There's 2 things in play here, DD increase due to price increase and the £400 rebate. Your DD should increase to 1/12th your annual use ignoring the rebate and the rebate should then be paid.  Have you been told how your supplier is processing the rebate? Is this Eon or Eon Next ? 2 different suppliers

So are you saying no suppliers are factoring in the £400 when calculating fixed DDs?
so everyone on fixed DD should end up with an extra £400 credit on their account where it’s not being refunded?

Do we we actually have access to how they calculate?

molerat

When calculating the DD they should be ignoring the £400.  When it comes to actually taking the DD they should reduce that amount by the £66/£67 rebate or return that amount to your bank account.

diystarter7

Not 100% sure but my understanding is my supplier/EDF is paying the 400 into iur registered account we use for DD payments to them.

born_again

Did  you not get the email from EON?

My current DD is £132 (£327 in credit)
So after the below email info Octobers DD is £65 

Your Direct Debit - and the Energy Bills Support Scheme.

We checked if your monthly Direct Debit (DD) is set to the right amount for the energy you're using, and it needs to change to £115.08, starting with your October payment.

You're eligible for the government's Energy Bills Support Scheme £400 discount, so your new Direct Debit amount will include this as a reduction by £67 a month from October to March. You don't need to do anything to claim this discount - it's automatically applied, you'll see it on your bill and you don't have to pay it back. 

So it is not spread over 12 months, but 6 months.

Now annoyed as Santander 123 lite acc, so are going to losing out on some of the 4% on the payment 😢

Brewer21

I'm with Eon.Next, they informed me yesterday via email that my DD is reducing by £67 from October 3rd. That's how I understand it should work with them and the £67/£66 reduction should be for the next 6 months = £400.👍
Its all pretty much as set out expected, i just need to check how its shown on my bill/account when it starts, something like I guess +£67 government energy payment.

 BTW my DD overall amount hasn't changed (yet)  I'm a low user on the variable tariff.

[Deleted User]

ElleLM said:

Eon have updated my monthly DD for new price caps starting 1st October 2022. According to media information the fixed £400 government payment to all households will be paid in six instalments from Oct- March of £66–£67pm. Why then has Eon spread the £400 payment over 12 months for calculating 1/12th DD payment?
Is this the way all energy companies will be paying the £400 effectively holding back £200 till after April?

Pretty sure you've misunderstood there   E.ON are modifying DDs for six months exactly as the government indcated.

[Deleted User]

In theory, this is what should have happened. From October, someone on the EPG will pay c.£2500 per year. The DD should be set at £2500/12 or £208 per month. For the 6 months from 1 October, the actual DD paid will be reduced by £66/67.

The missing piece of the jigsaw is the very late call on the EPG rates. I sense that not all customer accounts have been fully assessed. Mine most certainly hasn’t. 

PS The above assumes an AVERAGE consumer and no credit/debit balance.