If the price cap is going down, why have my monthly payments gone up?

System

This discussion was created from comments split from: New Energy Price Cap.

Recoverynurse

Yes I was under the impression too that the price cap was going down for households. My energy company Octopus has given me an estimated bill of £181 a month it was £162. So that’s another £20. It’s seems every b…. Is jumping on the band wagon and putting their prices up from cafes to hairdressers. The extra money I got with my pension has gone and I’m back to square one. I everything has gone and we the ordinary people suffer. Iv had enough with everyone using this as an excuse sorry that’s how it seems to me.

QrizB

For the actual October 2023 price cap, see this thread.

Recoverynurse said:

Yes I was under the impression too that the price cap was going down for households. My energy company Octopus has given me an estimated bill of £181 a month it was £162. So that’s another £20.

Is the £181 a bill, or is it 1/12th of their estimate of your total annual energy costs?

If it's a bill, why is it estimated rather than based on actual meter readings?
If it's your new 12-month budget DD, has your energy use increased?

[Deleted User]

Recoverynurse said:

Yes I was under the impression too that the price cap was going down for households. My energy company Octopus has given me an estimated bill of £181 a month it was £162. So that’s another £20. It’s seems every b…. Is jumping on the band wagon and putting their prices up from cafes to hairdressers. The extra money I got with my pension has gone and I’m back to square one. I everything has gone and we the ordinary people suffer. Iv had enough with everyone using this as an excuse sorry that’s how it seems to me.

What you pay each month depends on a number of factors. For example, how much energy you use compared to the averages Ofgem uses to set the Cap. Any DD reset will also take into account any debit/credit balance going forward and the possibility of increases in the cost of energy over the next 12 months.

I should add that monthly payments are not the same as energy charges. Your monthly payment goes into your account and charges for actual energy used are deducted from it. This is why it is better to look at tariff costs and energy used in kWh/year rather than any monthly DD payment.

Recoverynurse

can someone answer this. I pay £162 a month for gas and electricity. I’m careful as to what I use. My bill is going up in October to £181. I’m always in credit so far in the last few months Iv accumulated £400. Surely that means I’m paying more than I should for my bills?

Bendo

Unless you post your usage etc, unless someone has a crystal ball, nobody can answer it .

QrizB

Recoverynurse said:

can someone answer this. I pay £162 a month for gas and electricity. I’m careful as to what I use. My bill is going up in October to £181. I’m always in credit so far in the last few months Iv accumulated £400. Surely that means I’m paying more than I should for my bills?

It might, or it might not.

1. You would expect to be in credit by 2-3 monthly payments at this time of year (the end of August, about to go into autumn).
2. Last winter was a little milder than is typical. Chances are you'll use more energy next winter than last.
   

I think Octopus bill monthly. Was your latest bill based on actual meter readings, or was it estimated? On the bill, what have Octopus estimated your annual consumption to be?

Is your tariff Flexible Octopus?

400ixl

You bill isn't going up to £181, your monthly payment is going from £162 to £181. This isn't to be confused with the bill which is the calculation of the amount you have actually used (no of units * price of a unit + no of days of standing charge) minus the amount those payments have made.

We are currently in the summer period where consumption is less lower and people consume less, so you should expect to be in credit, but that credit may not be enough, or it could be you have not yet been billed for a period.

dunstonh

Recoverynurse said:

Yes I was under the impression too that the price cap was going down for households. My energy company Octopus has given me an estimated bill of £181 a month it was £162. So that’s another £20. It’s seems every b…. Is jumping on the band wagon and putting their prices up from cafes to hairdressers. The extra money I got with my pension has gone and I’m back to square one. I everything has gone and we the ordinary people suffer. Iv had enough with everyone using this as an excuse sorry that’s how it seems to me.

That is a very naive mindset.

a) the price cap it on the unit price.  Its not an "all you can eat" monetary amount.   If you use 100 units, you pay less than someone using 200 units.
b) commercial properties do not have a price cap and have seen much higher increases than residential
c) Autumn 2022/Winter 2023 was much milder than average.  So, people used less energy in that period.  Modelling will be closer to median.

Be thankful your pension went up higher than most peoples salary/earnings did.