Everyone paying for utilities on direct debit should check if they have overpaid now!

[Deleted User]

Suppliers are under considerable pressure from Ofgem not to allow consumers to get into debt. If the OP was posting her comments in September last year would she be concerned about a £100 credit balance? I suspect not.

Since then, the Ofgem Cap - now the EPG - has risen from just under £1000 a year for the average consumer to £2500 - with a possible increase in April 2023. It follows that a £300 credit balance today is not unreasonable. 

The usual follow on action by a supplier of a credit refund is an immediate increase in the monthly DD payment. It now has to recover the credit balance that has been refunded.

 DD payments of any amount are not overcharging. All DD payments are treated as money held on account from which charges for actual energy used - at the agreed tariff prices - are deducted. All credit balances are 100% protected. That said, the supplier is required to set DD payments based on their best estimates of annual usage.

Finally, whilst moving to variable DDs might seem to be attractive to some, I believe that when Winter bills hit the doormat we are going to see an increase in consumer energy debt and more pre-payment meters.

noitsnotme

Jackalynann said:

Or that I know what a smart meter does

Are you sure?  Because the “funny gadget” that was unplugged in the kitchen certainly was not the smart meter.

[Deleted User]

Or to put the original post in more accurate language - “my mum’s account has been topped up with more credit than I happen to think it needs”

Doesn’t sound quite so bad that way does it?

lisyloo

Jackalynann said:

Nobody is getting the point there was a huge overestimation. Or that I know what a smart meter does but a 90 year old may not understand it.  Mum will be in credit again this month because they could not reduce the direct debit. This again will build up. 

I do get your point and agree.
I believe they overestimate (I have a degree in mathematics and the calculations aren't rocket science).
They may be factoring in some things we don't know about (like future price increases) but it does seem to be working out rather in their favour IME.

Just ask them to change to variable (if they offer that option).
But be aware if she's on a low or fixed income then her bills will be a lot higher in winter.
Hopefully she gets council tax help, £400 help, winter fuel allowance and perhaps warm front grant (although criteria have changed for that).

To help her you could check she's getting everything she's entitled to.
I'm doing that for my Dad.
Don't bother arguing on here. The other option is a valid option for some people so there's no point.
Just accept there are options that suit different people.

[Deleted User]

lisyloo said:

Jackalynann said:

Nobody is getting the point there was a huge overestimation. Or that I know what a smart meter does but a 90 year old may not understand it.  Mum will be in credit again this month because they could not reduce the direct debit. This again will build up. 

I do get your point and agree.
I believe they overestimate (I have a degree in mathematics and the calculations aren't rocket science).
They may be factoring in some things we don't know about (like future price increases) but it does seem to be working out rather in their favour IME.

Just ask them to change to variable (if they offer that option).
But be aware if she's on a low or fixed income then her bills will be a lot higher in winter.
Hopefully she gets council tax help, £400 help, winter fuel allowance and perhaps warm front grant (although criteria have changed for that).

To help her you could check she's getting everything she's entitled to.
I'm doing that for my Dad.
Don't bother arguing on here. The other option is a valid option for some people so there's no point.
Just accept there are options that suit different people.

It tends to work “in their favour”, by which you mean more credit than strictly necessary, for the reasons that Dolor indicated.

We’ve all seen the threads on here - “I’ve been paying my bill each month but now they’ve sent me a huge extra one”.

VDD could be the right option here, if the OP is sure about being able to manage the cash flow (and the supplier offers it).

Your point about being sure to claim all possible support is spot on.

pochase

Ovo does not have a variable direct debit option, so this will not work.

[Deleted User]

I would just add that since our SMETS2 meters were installed over 3 1/2 years ago, our annual estimated usage has always been within the margins that I would have expected to see. They change monthly. 

As there are continuous data points (daily readings) being provided to the supplier, there is no reason for educated guesses. Estimates tend to be less accurate if readings are few and far between.

QrizB

Jackalynann said:

And we have done this before and mum had never underpaid, and her usage currently will not reach the 159 they are trying to take on direct debit. I have been checking daily and her usage is way below that amount.

You say "I have been checking daily". Are you checking the smart meter(s) or are you relying on the tales told by the in-home display?
The in-home display (the little gadget your mum unplugged) might not know the correct tariff details, so the £££ values it displays can't usually be trusted. The way to check your mum's usage is to read the smart meter(s), which is/are attached to the wall somewhere. (Or, if the meters are set for daily or half-hourly readings and are reporting correctly, you can check on your mum's online account.)

lisyloo

pochase said:

Ovo does not have a variable direct debit option, so this will not work.

Did add a caveat as I’m not up to date with every single supplier.

The options are Cash/cheque (more cost) or switch supplier to one that does.
I know shell and BG both do variable DD but obviously have to find a supplier accepting switches OR accept the higher cost of not having DD discount.

[Deleted User]

lisyloo said:

pochase said:

Ovo does not have a variable direct debit option, so this will not work.

Did add a caveat as I’m not up to date with every single supplier.

The options are Cash/cheque (more cost) or switch supplier to one that does.
I know shell and BG both do variable DD but obviously have to find a supplier accepting switches OR accept the higher cost of not having DD discount.

I think almost every supplier except Bulb will accept a switch if pushed (so would have to be phone or live chat), there have been noises from OFGEM about the lack of easy switching now.