In Credit but British Gas increasing DD

Angelcrackers

Hi

I noticed I had over £400 in credit on my Gas bill. British Gas put many excuses in the way of giving me a refund but eventually I argued that I am in credit year round as we don't use that much gas throughout the year. The agent calculated the correct amount owing from a current meter reading and then said he could refund the rest of around £350 after my next direct debit goes out. 

I kept asking why they had to wait because surely that would just increase the credit. For some reason he won't sway on this despite me not understanding why this is so.

So I spoke to another agent. She said -
Original credit £410
Minus debt owed for up to date reading left around £360
Then took OFF the amount of my upcoming DD leaving a refund due of £301. 

I have two questions - 
1) why are they taking off the upcoming DD amount? Surely once that is paid there will be even more credit so I am not understanding their methods. 
2) I was constantly in credit so reduced DD down to £45 (their offered amount) several months ago. During this conversation with the second agent she suddenly said my DD will go up this month to £69. I queried this and she said it had been organised by the previous agent as I was getting a refund! 

Help me make sense of this. I don't want to up the DD and don't see what I should as we go into the summer and even over last winter I constantly remained in credit. Why should they be doing this?

lisyloo

If you are careful then why not just switch to "whole of bill" direct debit and pay it as you go?
Obviously you need to expect some big bills in the winter - that's the con.

I do this and I much prefer it.
I wouldn't recommend it for people who are bad at managing money as there will be some eye-watering bills in the winter.

Alnat1

Dich and switch, get it all refunded and start with someone new.

Could you budget for a variable DD where you pay the full amount outstanding each month? This might mean bigger bills in winter when the heating is on but means the energy company doesn't hold onto any of your money, the balance gets zeroed each month. Several companies offer this payment method

mmmmikey

Hi, what they'll be doing is estimating what they think you're going to use over the next 12 months and then taking off the current credit balance to work out what you'll have to pay them to have a zero balance in 12 months time. They will then divide this by 12 to get a monthly figure. This has all gone wrong in recent years because it's entirely dependent on making a good estimate of not just how much you're going to use - they also need to know how much the energy is going to cost. Both those things have become difficult to predict so the whole system has become complicated.

Also, it's not uncommon to be in credit all year round. That would happen if you start a new agreement this time of year. Over the summer months when you're using less but paying the same you'll build up a healthy credit, which will then go down over the winter.

An easy way to resolve this if you can afford to is waiting until about September or October and then changing supplier. This will force a refund from your existing supplier and you'll start with a zero balance with your new one, you just need to make sure that your direct debit is set at the right level. As well as getting your money back you'll then spend less of the year in credit.

Hope this makes sense?

pete-20-11

Find a friend or family member on octopus, ask them for a referral code (so you both get £50) and switch to Octopus

octopus allow you to take control of your direct debit, mine is set to £10 a month as I have a healthy balance and I’m earning money from solar this time of year.

there are of course other suppliers out there, most of them are better than BG for customer services and some are better for price too. 

400ixl

What is your annual consumption? Should be on your bill.

Take that and multiply it by the unit price, divided by 12 will give you how much your monthly DD should be. You can do a calculation with your current credit to identify what it would be if you didn't take the credit back.

wrf12345

If you switch, bear in mind BG will still take the DD even if you are hundreds in credit and the new supplier may also take the DD in advance, so may hit your cashflow. I would take the refund, switch to a new supplier and cancel the BG DD (may be a slight increase in charges if they have the wit to put you on pay on bill) and if you put the DD date with the new supplier at less than 15 days from changeover they will probably skip the first payment. If you transfer put in yearly consumption figures that match the amount of DD you want to pay (they will have access to past usage so silly figures will not work). And do check that the meter readings are the same (BG are okish, some companies are not), if you are on Smart meters should be a couple of days to complete. Octopus are good on the telephone and have some interesting tariffs if you can vary the timing of your usage and also variable direct debit if required. If you search google, there are links that will get you the £50 reward - and it works. Unless BG are offering something unique, such as fixed with low s/c's, not worth the constant hassle.

Angelcrackers

Thank you so much everyone. There is a lot of good advice here and I'm now off to do some calculations and research. Really appreciate such quick responses too!

pseudodox

Also note that if you know someone who is with EDF then they also currently do a referral bonus, which gets you and your friend a nice £50 each.  A lot of bad press on here for EDF but I have found them as good as I might want from an energy supplier over the past 18 months I have been with them.  And EDF also do the variable monthly DD.  Just put the extra money you are not handing over to the supplier each month in an interest earning account ready for those higher winter bills.  And enjoy the lower summer bills of course.

Eldi_Dos

pete-20-11 said:

Find a friend or family member on octopus, ask them for a referral code (so you both get £50) and switch to Octopus

Don't even have to seek them out, when I got a quote from them this week somehow myself and a lass called Rachael where getting the £50 bonus/credit each.

Pity their rates did not seem that enticing so just going to wait till the 24th and see what the announcement says then before doing anymore looking around.

bob2302

400ixl said:

What is your annual consumption? Should be on your bill.

Take that and multiply it by the unit price, divided by 12 will give you how much your monthly DD should be. You can do a calculation with your current credit to identify what it would be if you didn't take the credit back.

You forgot to add the SC