Outfox The Market - cooking the numbers - gas estimated usage to 72% higher than actual usage

NandoDave

I have had a recent email through from Outfox The Market. They've decided to more than double my direct debit in January. My credit balance is eroding so the DD amount did actually need to go up at some point, but something seemed off with the amount so I looked carefully at the numbers in the email (bold emphasis mine):

"As of 14th December 2022, we estimate you’ll use 2,362 kWh of electricity and 7,792 kWh of gas over the next 12 months."

That's strange, because my bill on 6th December quoted the same estimated usage that has been presented all year - 5,089 kWh gas. If I look at my actual usage both from the meter readings and their own usage tracker table, in the year to and including November 2022 I used just over 4,500 kWh gas. So my usage has dropped, but they've inexplicably increased the usage estimate overnight to 72% more than my actual recorded usage.

Given that Outfox the Market doesn't appear to have rectified their alleged financial responsibility situation with Ofgem yet, I'm left wondering how many of their customers they have done this to. Has anyone else had this email, and do you have a similar 'mistake' in your estimated gas usage?

[Deleted User]

So, your usage through a mild winter and up to (but stopping just before) it got cold this year was low.  Ok, seems fair enough.

But the supplier thinks that it might be higher this coming year?

I'd be inclined to agree with them having experienced the last ten days of freezing temperatures.  I certainly wouldn't categorise it as an "inexplicable" position.

On the SLC contravention notice - which you seem to blame for the DD increase - you do realise that holding extra customer credit balances makes their position worse regarding that condition? 

NandoDave

Deleted_User said:

So, your usage through a mild winter and up to (but stopping just before) it got cold this year was low.  Ok, seems fair enough.

But the supplier thinks that it might be higher this coming year?

I'd be inclined to agree with them having experienced the last ten days of freezing temperatures.  I certainly wouldn't categorise it as an "inexplicable" position.

On the SLC contravention notice - which you seem to blame for the DD increase - you do realise that holding extra customer credit balances makes their position worse regarding that condition? 

My estimated usage of 5,089 kWh has been in place for quite some time. The prior winter (2020/21) temperature anomaly in my region was shallowly negative to the 1991-2020 average. My usage in that period remained just over the figure quoted. On what basis does Outfox the Market have to predict the weather will be unseasonably cold enough give rise to a >50% increase in gas usage given that the Met Office's long range forecast doesn't support this?

Increased customer credit balances would make the scale of any mutualisation worse, but my understanding is that the concern from Ofgem is related to the companies cash position laid against insufficient hedging and Renewables Obligation liabilities - hence them ordering the company to improve their cash position without delay. And now the companies have been told that plans for ringfencing have been dropped, aren't they free to use customer DDs as a tool to raise cash?

[Deleted User]

NandoDave said:

Deleted_User said:

So, your usage through a mild winter and up to (but stopping just before) it got cold this year was low.  Ok, seems fair enough.

But the supplier thinks that it might be higher this coming year?

I'd be inclined to agree with them having experienced the last ten days of freezing temperatures.  I certainly wouldn't categorise it as an "inexplicable" position.

On the SLC contravention notice - which you seem to blame for the DD increase - you do realise that holding extra customer credit balances makes their position worse regarding that condition? 

My estimated usage of 5,089 kWh has been in place for quite some time. The prior winter (2020/21) temperature anomaly in my region was shallowly negative to the 1991-2020 average. My usage in that period remained just over the figure quoted. On what basis does Outfox the Market have to predict the weather will be unseasonably cold enough give rise to a >50% increase in gas usage given that the Met Office's long range forecast doesn't support this?

Increased customer credit balances would make the scale of any mutualisation worse, but my understanding is that the concern from Ofgem is related to the companies cash position laid against insufficient hedging and Renewables Obligation liabilities - hence them ordering the company to improve their cash position without delay. And now the companies have been told that plans for ringfencing have been dropped, aren't they free to use customer DDs as a tool to raise cash?

Well, not without falling foul of that same licence condition.  And/or of the special instructions from OFGEM to be "a bit more sensible" with DDs (my paraphrase).

To be fair to your concern, though, if I was going to guess a supplier that might play fast and loose with the rules, or test the line by stepping slightly past it, OftM would be up there - there is plenty of history leaning that way.

wild666

I left them in Dec. 2018 because they wanted to increase my DD to £120 per month in winter and £70 per month in summer. Before that my summer usage was around £37 for E and £8 for G and in winter it was around £37 for E and £35 for G per month, that's if I put the heating on instead of a hot water bottle. 
Given that both my summer and winter usage would have continually built up a credit every month I decided to leave them and they tried every trick they could think of to stop me leaving and it took me 8 months to get a final bill, which cost them £70 as I complained through Resolver and won. 

Mstty

Sometimes you have to hit hard back if you know you are in the right.

Raise a complaint based on your evidence and let them know you will rake this to the ombudsman if you are not happy.

They won't want the ombudsman cost of you have laid out all your evidence of historical use clearly. Let them know exactly what you suspect them to do and the amount you think your DD should be set to and throw in a comment about unnecessary worry before Christmas and now time spent on this trivial matter and they should consider a goodwill gesture to your account.

Good luck

EssexHebridean

Hi OP. I’m struggling to see at the moment if you have actually contacted OFTM about this situation at all? If you haven’t, as yet, then as a first step you need to get in contact with them and tell them that you consider their suggested increase to be unreasonable (make sure you use that word as they have a duty to ensure that DDs are reasonable - and they will know this) and that the new estimated use figure seems inconsistent with what you have used before.  Tell them what you have calculated, make sure you incorporate (and make it clear that you HAVE incorporated) the April price rises, and tell them that in fact you consider a reasonable amount for your increased DD to be £xx.xx per month, and you would like them to set it there, please.  Do make clear that the level of increase they are talking about would leave you in financial hardship if this is the case, also. 

See what they say - but in the first instance if you haven’t queried it at all, I’d suggest a formal complaint might be a little heavy handed. 

Martin Lewis did a section in one of his podcasts recently about how to approach unreasonable DD increases - well worth a listen. 

NandoDave

I am fully intending on resolving this situation for myself (by complaining, to ensure it is recorded, but ultimately I will be moving supplier if I can).

I'm more generally concerned that a resolution of my complaint won't require OFTM to correct whatever 'mistake' they might have made on their whole book of customers and consequently they're pulling significantly too much money out of their customers' bank accounts just 3 weeks after being written to by the business secretary about this very issue.

MattMattMattUK

The energy suppliers cannot win on this one, they are instructed to increase payments to stop customers getting into debt, decrease them to stop customers gaining large credit balances, to not adjust payments to regularly and to somehow do that whilst predicting the weather six months in advance and changes in government subsidy over the next year. They are trying to hit a moving target in high wind, whilst partially blindfolded, and every time they miss, nomatter by how little someone starts screaming at them. 

The last two winters have been very mild, as were October and November this year, but we have now had the coldest start to December for several years, however not it is warming up considerably. People are changing usage due to price, but many do also not understand how credit balances and billing cycles work.

In this case OFTM may have made a mistake, they may be tying to account for nothing the colder winter so far, predicted colder (that previous years) winter for the rest of winter, stopping customers getting into debt etc. They may have got it wrong, the may have not.

As for the letter from the Business Secretary, it was a political statement designed to get them credit with some members of the public rather than sensible and considered public policy.

NandoDave

Several posts today on the Outfox the Market's Official Customer Discussion Group on Facebook with similar stories, so this looks to be something not restricted to just me.

[Deleted User]

NandoDave said:

I am fully intending on resolving this situation for myself (by complaining, to ensure it is recorded, but ultimately I will be moving supplier if I can).

I'm more generally concerned that a resolution of my complaint won't require OFTM to correct whatever 'mistake' they might have made on their whole book of customers and consequently they're pulling significantly too much money out of their customers' bank accounts just 3 weeks after being written to by the business secretary about this very issue.

Why is it that posters conclude that a supplier is engaged in wrong doing just because they disagree with a supplier decision? The supplier might have got a considered opinion from the Met Office that we are facing a winter similar to that of 1962/3 when the UK had well below zero temperatures for over 2 months. Given the 10 days we have just had, I would expect all annual usage estimates to increase.

I would also suggest that making defamatory statements on a public forum might not be a wise thing to do. Courts can force website owners to release a poster’s personal contact details. 

You can bring your concerns to Ofgem’s attention by contacting it at consumeraffairs@ofgem.gov.uk