In credit with BG can I cancel DD?

andrew71

We are currently in credit (over £1000) with  British Gas. My wife's been talking to her friends who've told her that they've stopped paying their Direct Debit. Saying their energy supplier would have to use what's in the credit account before they can request money. 
I'm not so sure. 
I think if we cancel it would have some knock on effect. 

[Deleted User]

You may get moved onto a tariff that is between 7% and 10% more expensive.  You may face charges for missing payments.

Unilaterally cancelling a DD is not a good thing to do.

If you moved to variable DD (which BG might be reluctant to offer but I understand they do), they would then use up your credit before you would then pay each month for your actual use without any extra cost.  Be aware though, this would of course mean your bill in the winter could be much higher than your bill in the summer.

mmmmikey

I had no problem switching to DD Whole Amount Monthly with EDF - I just asked via their online chat and they did it without question. After I had switched, getting the credit back was equally straightforward. Can't speak for BG but EDF was painfully easy - for me at least.

[Deleted User]

Eighteen months ago, if you had a credit balance of £300 at the start of Winter would you be posting? I suspect not.
A credit balance of £1000 may seem to be a lot but given the way energy costs have risen it is not that high for dual fuel imho.

Paying by variable DD may sound like a great idea; however, you need to satisfy yourself of two things: one, you will not fritter away the £1000 on Christmas et al and, two, if you do, then you still have the financial resources to pay for some very large Winter bills.

Bear in mind that your £1000 credit balance is 100% protected, and easy access interest rates less tax are not that great. You only pay for the actual energy that you use at the agreed tariff rates.

dunstonh

andrew71 said:

We are currently in credit (over £1000) with  British Gas. My wife's been talking to her friends who've told her that they've stopped paying their Direct Debit. Saying their energy supplier would have to use what's in the credit account before they can request money. 
I'm not so sure. 
I think if we cancel it would have some knock on effect. 

After Summer, you expect to go into the colder months with around 3-5 times your normal monthly payment in credit, assuming your normal monthly figure is accurate for your use.

You can use as much as 80% of your annual energy in the coldest months of the year.   Hence why you build up summer credit.  

If all is well, the credit should end up bring eroded to near zero by the time you get to May next year.   Any surplus at that point can be drawn out.

Jaybee_16

I'm with Bulb and having the opposite to the OP. Currently £300 in credit (electricity only) and Bulb email me monthly advising I should reduce my monthly DD to £1. Keep ignoring their emails as I prefer the credit balance in the winter months. 

Snwps

When was your last bill raised by BG? If it was some time ago some/most/all of that credit could be used by unbilled usage. 

pochase

Please don't forget that BG only bills every 6 months. In the meantime all your payments are been added as credit.

So you might have 5 DD payments in your account without the used energy cost been shown, and your £1000 credit might be much lower.

When was your last BG bill?

dunstonh

Deleted_User said:

dunstonh said:

andrew71 said:

We are currently in credit (over £1000) with  British Gas. My wife's been talking to her friends who've told her that they've stopped paying their Direct Debit. Saying their energy supplier would have to use what's in the credit account before they can request money. 
I'm not so sure. 
I think if we cancel it would have some knock on effect. 

After Summer, you expect to go into the colder months with around 3-5 times your normal monthly payment in credit, assuming your normal monthly figure is accurate for your use.

You can use as much as 80% of your annual energy in the coldest months of the year.   Hence why you build up summer credit.  

If all is well, the credit should end up bring eroded to near zero by the time you get to May next year.   Any surplus at that point can be drawn out.

And for that reason, even if you have plenty of money to cover winter bills it can be more convenient to pay a regular monthly sum - less hassle over making sure you've got sufficient funds in your bank account.

BUT..

I'm with EDF. I was moved to them in Nov last year. I had a credit balance at the end of winter (which they didn't refund) and an even bigger credit balance at the end of summer - WHICH THEY REFUNDED! Which totally invalidates the idea that they do this to help people manage their money. EDF's policy is to automatically refund any credit balance over £40 at the end of each year. The end of the year (in my case at least) falling in November. 

I mean, in principle equal monthly payments can be helpful to all sorts of people and it's not as if you can get much interest on your money. But they are clearly 'at it' (using DD to help their cash flow rather than to help the customer)- and if someone is confident that they can manage their finances they should stick to their guns and get their money back. 

The principle is a good idea.  However, the implementation needs to be right.  Otherwise it will just end up messy and pointless.

EssexHebridean

The old idea that everyone builds up credit in the summer and uses it up and possibly even ventures into debit slightly during the winter is a bit outdated now as a lot of suppliers simply no longer go by a calendar year like this. People tend to change suppliers a lot more frequently these days, so many suppliers now take the "year start" for a customer as when they joined. So far as Octopus are concerned, our year "starts" in October for example - they didn't expect me to be in heaps of credit in Novemer because at that stage we literally had made them a single payment!