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Can energy suppliers insist you stay in credit?

System
System Posts: 178,092 Community Admin
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edited 28 September 2023 at 3:40PM in Ask An Expert
victor2 said:
When payment by direct debit was first introduced, you would expect your account to be in credit over the summer and debit over the winter. Now it seems suppliers want you to always be in credit. Can they enforce this?
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Ask An Expert: Answered · Last Updated

Hi victor2

You are correct that typically you'll be in credit after the summer months, but this isn't always the case.

Ofgem set out guidelines for ""fair and reasonable"" direct debits, meaning suppliers must take reasonable steps to ensure customers' direct debit levels are based on the best available information, and they must be able to explain to you how they set it.

If you have accumulated credit, you're entitled to ask for it back, and your supplier must refund it. If your supplier thinks the credit should be withheld, it must clearly explain the reasons why - but you can challenge this.

See Martin Lewis: Energy bill credit – how much is too much? and our Energy direct debits help guide for more details.

This question and answer came about during the MSE Forum 'Ask An Expert' event in Sep 2023. It won't be updated so may no longer be correct at time of reading. This info does not constitute financial advice: always do your own research on top to make sure it's right for your circumstances.

Comments

  • victor2
    victor2 Posts: 7,574 Ambassador
    I'm a Volunteer Ambassador First Anniversary Name Dropper First Post
    When payment by direct debit was first introduced, you would expect your account to be in credit over the summer and debit over the winter. Now it seems suppliers want you to always be in credit. Can they enforce this?

    I’m a Forum Ambassador and I support the Forum Team on the In My Home MoneySaving, Energy and Techie Stuff boards. If you need any help on these boards, do let me know. Please note that Ambassadors are not moderators. Any posts you spot in breach of the Forum Rules should be reported via the report button, or by emailing forumteam@moneysavingexpert.com. 

    All views are my own and not the official line of MoneySavingExpert.

  • la531983
    la531983 Posts: 1,850 Forumite
    First Post Name Dropper
    If you have an issue with this, simply ask to go onto Variable DD and supply a meter reading every month to facilitate this. 

    If your provider doesn't offer it, move to one who does. 
  • victor2 said:
    When payment by direct debit was first introduced, you would expect your account to be in credit over the summer and debit over the winter. Now it seems suppliers want you to always be in credit. Can they enforce this?
    Yes, they can.
  • Hi victor2You are correct that typically you'll be in credit after the summer months, but this isn't always the case. Ofgem set out guidelines for "fair and reasonable" direct debits, meaning suppliers must take reasonable steps to ensure customers' direct debit levels are based on the best available information, and they must be able to explain to you how they set it. If you have accumulated credit, you're entitled to ask for it back, and your supplier must refund it. If your supplier thinks the credit should be withheld, it must clearly explain the reasons why - but you can challenge this. See Martin Lewis: Energy bill credit – how much is too much? and our Energy direct debits help guide for more details.
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