Is 8.1 Billion too much for energy firms to hold of customer money?

wild666

I believe BG were making millions from the free electric tariff that ran from 2015 to 2018 as the unit rates took into account the average usage for those 8 hours and put it onto the unit rates that an average user would use over the week. I can't remember the unit rates but the SC in my area was 26.1p per day on electric and gas. So over the 8 hour period you paid for the usage over the preceding 6 days.
I used too hit the electric for all I could in those 8 hours turning on everything even if I didn't need it on. My usage over those 8 hours would regularly top 14 kWh, 1.75 kWh per hour. 

born_again

dealyboy said:

@markinsaid:

@stu12345_2 said:

@subjecttocontract said:

I'm a few hundred quid in credit, pretty much what would be expected this time of year. I don't see any problems with it. This is someone trying to find a problem that doesn't exist.

that few hundred quid could be in an interest bearing short term  cash account making you money.
in the same way the energy companies are enjoying your money.

Or more people having to put it on the CC or get payday loans because they spent it all on the kids over the summer, Its why most people like fixed DD's

@ArbitraryRandom said:

stu12345_2 said:

50 p meters will solve anyone being short for when their variable bill comes in 
all we need is for the meters to accept debit cards every week.
 instead.
pay as you go sorted.

You do you - but I'm not convinced switching from predictable monthly payments to a variable bill with my power being shut off if I can't pay an unexpectedly high bill is the right option for me (or the majority). 

So why do 'most people like fixed DD's' ... 'the majority'. Is this actually true? I find it hard to believe IMHO.

My experience with fixed or 'static' DDs has been almost entirely bad. ...
- Historically Symbio grossly inflated my payments to 4x my previous winter monthly costs.
- IIRC suppliers invariably use old annual usage data, whether inherited or not, and is slow to change.
- Even when a change is made to the DD sometimes it is suddenly reset.

Are we really saying that over 50% are feckless, or cannot cope with varying payments, or are so poor that an 'unexpected' high payment would leave their finances in collapse, or are so rich that they are happy to leave average payments to their suppliers, or are not interested in saving money?

What is wrong with me? Paying for what I use when (after) I use it (MVDD) is so obviously the best way to be ... but I know I'm not the only one who is mad, though we may be in the minority.

How many people have fixed mortgages?
Only complaints you ever see on mortgages are people on variable rates when interest rates rise & they struggle to afford them.
Just like energy bills over winter.

You have the choice to do what you want with your energy bills. So does everyone else. I'm more than happy to build up a nice credit balance. We are low usage here & £300 credit in November was gone in March this year, despite all the Gov payments & it was not a cold winter.

[Deleted User]

born_again said:

dealyboy said:

@markinsaid:

@stu12345_2 said:

@subjecttocontract said:

I'm a few hundred quid in credit, pretty much what would be expected this time of year. I don't see any problems with it. This is someone trying to find a problem that doesn't exist.

that few hundred quid could be in an interest bearing short term  cash account making you money.
in the same way the energy companies are enjoying your money.

Or more people having to put it on the CC or get payday loans because they spent it all on the kids over the summer, Its why most people like fixed DD's

@ArbitraryRandom said:

stu12345_2 said:

50 p meters will solve anyone being short for when their variable bill comes in 
all we need is for the meters to accept debit cards every week.
 instead.
pay as you go sorted.

You do you - but I'm not convinced switching from predictable monthly payments to a variable bill with my power being shut off if I can't pay an unexpectedly high bill is the right option for me (or the majority). 

So why do 'most people like fixed DD's' ... 'the majority'. Is this actually true? I find it hard to believe IMHO.

My experience with fixed or 'static' DDs has been almost entirely bad. ...
- Historically Symbio grossly inflated my payments to 4x my previous winter monthly costs.
- IIRC suppliers invariably use old annual usage data, whether inherited or not, and is slow to change.
- Even when a change is made to the DD sometimes it is suddenly reset.

Are we really saying that over 50% are feckless, or cannot cope with varying payments, or are so poor that an 'unexpected' high payment would leave their finances in collapse, or are so rich that they are happy to leave average payments to their suppliers, or are not interested in saving money?

What is wrong with me? Paying for what I use when (after) I use it (MVDD) is so obviously the best way to be ... but I know I'm not the only one who is mad, though we may be in the minority.

How many people have fixed mortgages?
Only complaints you ever see on mortgages are people on variable rates when interest rates rise & they struggle to afford them.
Just like energy bills over winter.

You have the choice to do what you want with your energy bills. So does everyone else. I'm more than happy to build up a nice credit balance. We are low usage here & £300 credit in November was gone in March this year, despite all the Gov payments & it was not a cold winter.

I agree. People advocating ‘pay on bill’ with a variable DD give little thought to what it might mean for payees if we have a prolonged cold snap from late December to March as happened in 62/63. If smoothing payments out over 12 months helps people manage their finances, then it should be encouraged.

The problem with credit balances is that people forget that the average annual usage cost is now many times higher than it was 2 years ago. It follows that as we enter Winter, individual credit balances will also be high.

I

dealyboy

@born_again said:

dealyboy said:

@markinsaid:

@stu12345_2 said:

@subjecttocontract said:

I'm a few hundred quid in credit, pretty much what would be expected this time of year. I don't see any problems with it. This is someone trying to find a problem that doesn't exist.

that few hundred quid could be in an interest bearing short term  cash account making you money.
in the same way the energy companies are enjoying your money.

Or more people having to put it on the CC or get payday loans because they spent it all on the kids over the summer, Its why most people like fixed DD's

@ArbitraryRandom said:

stu12345_2 said:

50 p meters will solve anyone being short for when their variable bill comes in 
all we need is for the meters to accept debit cards every week.
 instead.
pay as you go sorted.

You do you - but I'm not convinced switching from predictable monthly payments to a variable bill with my power being shut off if I can't pay an unexpectedly high bill is the right option for me (or the majority). 

So why do 'most people like fixed DD's' ... 'the majority'. Is this actually true? I find it hard to believe IMHO.

My experience with fixed or 'static' DDs has been almost entirely bad. ...
- Historically Symbio grossly inflated my payments to 4x my previous winter monthly costs.
- IIRC suppliers invariably use old annual usage data, whether inherited or not, and is slow to change.
- Even when a change is made to the DD sometimes it is suddenly reset.

Are we really saying that over 50% are feckless, or cannot cope with varying payments, or are so poor that an 'unexpected' high payment would leave their finances in collapse, or are so rich that they are happy to leave average payments to their suppliers, or are not interested in saving money?

What is wrong with me? Paying for what I use when (after) I use it (MVDD) is so obviously the best way to be ... but I know I'm not the only one who is mad, though we may be in the minority.

How many people have fixed mortgages?
Only complaints you ever see on mortgages are people on variable rates when interest rates rise & they struggle to afford them.
Just like energy bills over winter.

You have the choice to do what you want with your energy bills. So does everyone else. I'm more than happy to build up a nice credit balance. We are low usage here & £300 credit in November was gone in March this year, despite all the Gov payments & it was not a cold winter.

Thanks for your comments and I agree with the choice argument in your second paragraph, but forgive me isn't the fixed vs. variable rate mortgage debate more akin to fixed vs. variable rate tariff rather than DD?

@[Deleted User] said:

born_again said:

dealyboy said:

@markinsaid:

@stu12345_2 said:

@subjecttocontract said:

I'm a few hundred quid in credit, pretty much what would be expected this time of year. I don't see any problems with it. This is someone trying to find a problem that doesn't exist.

that few hundred quid could be in an interest bearing short term  cash account making you money.
in the same way the energy companies are enjoying your money.

Or more people having to put it on the CC or get payday loans because they spent it all on the kids over the summer, Its why most people like fixed DD's

@ArbitraryRandom said:

stu12345_2 said:

50 p meters will solve anyone being short for when their variable bill comes in 
all we need is for the meters to accept debit cards every week.
 instead.
pay as you go sorted.

You do you - but I'm not convinced switching from predictable monthly payments to a variable bill with my power being shut off if I can't pay an unexpectedly high bill is the right option for me (or the majority). 

So why do 'most people like fixed DD's' ... 'the majority'. Is this actually true? I find it hard to believe IMHO.

My experience with fixed or 'static' DDs has been almost entirely bad. ...
- Historically Symbio grossly inflated my payments to 4x my previous winter monthly costs.
- IIRC suppliers invariably use old annual usage data, whether inherited or not, and is slow to change.
- Even when a change is made to the DD sometimes it is suddenly reset.

Are we really saying that over 50% are feckless, or cannot cope with varying payments, or are so poor that an 'unexpected' high payment would leave their finances in collapse, or are so rich that they are happy to leave average payments to their suppliers, or are not interested in saving money?

What is wrong with me? Paying for what I use when (after) I use it (MVDD) is so obviously the best way to be ... but I know I'm not the only one who is mad, though we may be in the minority.

How many people have fixed mortgages?
Only complaints you ever see on mortgages are people on variable rates when interest rates rise & they struggle to afford them.
Just like energy bills over winter.

You have the choice to do what you want with your energy bills. So does everyone else. I'm more than happy to build up a nice credit balance. We are low usage here & £300 credit in November was gone in March this year, despite all the Gov payments & it was not a cold winter.

I agree. People advocating ‘pay on bill’ with a variable DD give little thought to what it might mean for payees if we have a prolonged cold snap from late December to March as happened in 62/63. If smoothing payments out over 12 months helps people manage their finances, then it should be encouraged.

The problem with credit balances is that people forget that the average annual usage cost is now many times higher than it was 2 years ago. It follows that as we enter Winter, individual credit balances will also be high.

I

a prolonged cold snap from late December to March as happened in 62/63. You remember that as well? there was solid ice on the pavement outside our house for most of that time ... but Billy Fury and the Beatles brightened our lives.

I think it's a matter of free and informed choice, and I think your argument is one of control of events or rather not being controlled by events, where one's account can go into managed debit. I am genuinely surprised that most people would opt for it though.

I can see that fixed DD may be appropriate for some and I certainly wouldn't want people to restrict their energy usage through fear of 'unknown' bills.

badmemory

I remember that cold snap well & followed by a May bank holiday that was so hot it was the only time I have ever been sunburnt. 

I think I have the opposite problem to most as even though I have decreased my usage I don't think my DD is quite enough, not enough to be a problem.  I just wish BG would actually bill promptly, although I do (& give them) monthly readings & prepare my own version of the bill, which is a lot easier than trying to check their jumbled up messes.

dealyboy

@badmemory said:

I remember that cold snap well & followed by a May bank holiday that was so hot it was the only time I have ever been sunburnt. 

I think I have the opposite problem to most as even though I have decreased my usage I don't think my DD is quite enough, not enough to be a problem.  I just wish BG would actually bill promptly, although I do (& give them) monthly readings & prepare my own version of the bill, which is a lot easier than trying to check their jumbled up messes.

Cor, you've got a good memory @badmemory, but you've a good reason  I think BG are vying with EDF (my supplier) in the worst service awards. 

ArbitraryRandom

dealyboy said:

@born_again said:

dealyboy said:

@markinsaid:

@stu12345_2 said:

@subjecttocontract said:

I'm a few hundred quid in credit, pretty much what would be expected this time of year. I don't see any problems with it. This is someone trying to find a problem that doesn't exist.

that few hundred quid could be in an interest bearing short term  cash account making you money.
in the same way the energy companies are enjoying your money.

Or more people having to put it on the CC or get payday loans because they spent it all on the kids over the summer, Its why most people like fixed DD's

@ArbitraryRandom said:

stu12345_2 said:

50 p meters will solve anyone being short for when their variable bill comes in 
all we need is for the meters to accept debit cards every week.
 instead.
pay as you go sorted.

You do you - but I'm not convinced switching from predictable monthly payments to a variable bill with my power being shut off if I can't pay an unexpectedly high bill is the right option for me (or the majority). 

So why do 'most people like fixed DD's' ... 'the majority'. Is this actually true? I find it hard to believe IMHO.

My experience with fixed or 'static' DDs has been almost entirely bad. ...
- Historically Symbio grossly inflated my payments to 4x my previous winter monthly costs.
- IIRC suppliers invariably use old annual usage data, whether inherited or not, and is slow to change.
- Even when a change is made to the DD sometimes it is suddenly reset.

Are we really saying that over 50% are feckless, or cannot cope with varying payments, or are so poor that an 'unexpected' high payment would leave their finances in collapse, or are so rich that they are happy to leave average payments to their suppliers, or are not interested in saving money?

What is wrong with me? Paying for what I use when (after) I use it (MVDD) is so obviously the best way to be ... but I know I'm not the only one who is mad, though we may be in the minority.

How many people have fixed mortgages?
Only complaints you ever see on mortgages are people on variable rates when interest rates rise & they struggle to afford them.
Just like energy bills over winter.

You have the choice to do what you want with your energy bills. So does everyone else. I'm more than happy to build up a nice credit balance. We are low usage here & £300 credit in November was gone in March this year, despite all the Gov payments & it was not a cold winter.

Thanks for your comments and I agree with the choice argument in your second paragraph, but forgive me isn't the fixed vs. variable rate mortgage debate more akin to fixed vs. variable rate tariff rather than DD?

I'd say it's a bit of both - having a fixed DD and being on a fix means I know (and have some control over) what I'm paying out each month. Having a fixed mortgage does the same by locking in the rate for the term - the difference is the variation in usage seasonally with energy that you don't have with mortgages. 

Grumpy_chap

dealyboy said:

So why do 'most people like fixed DD's' ... 'the majority'. Is this actually true? I find it hard to believe IMHO.

My experience with fixed or 'static' DDs has been almost entirely bad. ...
- Historically Symbio grossly inflated my payments to 4x my previous winter monthly costs.
- IIRC suppliers invariably use old annual usage data, whether inherited or not, and is slow to change.
- Even when a change is made to the DD sometimes it is suddenly reset.

Are we really saying that over 50% are feckless, or cannot cope with varying payments, or are so poor that an 'unexpected' high payment would leave their finances in collapse, or are so rich that they are happy to leave average payments to their suppliers, or are not interested in saving money?

What is wrong with me? Paying for what I use when (after) I use it (MVDD) is so obviously the best way to be ... but I know I'm not the only one who is mad, though we may be in the minority.

Fixed DD for energy has been very well established for many years.
I can't give facts to prove it is the majority.
However, there seems to be a growing number of people that convert everything to "monthlies":

• Car PCP
• Insurance policies
• Council tax
• Water bills
• Annual holiday

It seems perfectly reasonable that anyone falling in that group would find fixed DD energy just the obvious thing to do.

I am not in that "monthlies" group, but still find fixed DD energy the obvious thing to do.

Obviously, just my experience does not make a reliable data set.

MattMattMattUK

Dolor said:
I agree. People advocating ‘pay on bill’ with a variable DD give little thought to what it might mean for payees if we have a prolonged cold snap from late December to March as happened in 62/63. If smoothing payments out over 12 months helps people manage their finances, then it should be encouraged.

The problem with credit balances is that people forget that the average annual usage cost is now many times higher than it was 2 years ago. It follows that as we enter Winter, individual credit balances will also be high.

I agree, variable Direct Debit is great for me and many people I know, but it is not a good thing for those on a tight budget, or those who struggle to budget, or for those who prefere the regularity of a fixed/budget. It absolutely works for many, but not for all, one of the reasons we have multiple payment methods for energy.

I think the second part is why so many of the regulars on here try to get people to think in kWh rather than £, it gives them a far better command of their costs. 

Qyburn

I'm not convinced people really aren't able to budget for variable Summer/Winter payments. What about people using oil or LPG? It's quite common to buy up to a year's supply at a time. Solid fuel as well, our neighbours a while back used to buy their year's supply of housecoal and anthracite in one order to get the best price.