Eon Next has a problem with £60 debit balance (May 2024)

kidkal

Hello, I've just been called by Eon Next saying that they are doing a "regular review" of my direct debit amount and my current tariff.  It was pointed out to me that since I currently have a debit balance (£60), that in next month when my direct debit amount will be used to first pay off this balance before any energy usage changes, which could also be increasing, thereby creating an ever larger debit (negative) balance.  For perspective this balance is about 2% of my yearly usage.

I pointed out to him that the energy usage amount can also be decreasing and is most likely to do so since we are coming into the summer months when energy usage drops.

He ignored this point and asks whether I wanted to change to a fixed tariff.  I politely declined (I am on the Next Pledge Tracker 12m V3).

Then he went on to say that my direct debit amount is too low based on their new estimation and that I am in some kind of danger of having a runaway debt balance.  I would have been more agreeable with that if say the debit balance is over 3 months worth of monthly payments and it is the beginning of winter!  So I flatly refused to revise my direct debit amount.

He continued to say that they will have another review in 3 months.

Is this usual behaviour?  Is Eon really short of cash?  I'm curious on other's views.  Thanks.

mmmmikey

Your direct debit amount depends on an estimate of what you'll use over the next year, an estimate of what that will cost and adjustment for any balance on the account they have at the moment. Over the last few years, usage patterns have changed due to things like people working from home during the pandemic and just using less energy because they are more conscious of the cost. Also, prices have been fairly unpredictable and that has lead to customers with large account balances - credits or debits. This has lead to a fair amount of bouncing about of direct debit payments - sometimes for good reasons and sometimes not. 

The thing you need to focus on is your estimated usage over the next 12 months and from that you can work out roughly what you should expect to pay - I'd assume that current pre-July decrease rates are a reasonable guess for the average over the next year. If you calculate that figure, add what you owe them now and divide by 12 you should come to an appropriate figure. If this is in the same ball park as their's then all is good. Note that you would expect to build up a credit balance during the summer months and then use that up over the winter - the idea of fixed monthly direct debits is to be quits at the end of the year and it is to be expected that the balance will vary during the year. 

If this system doesn't suit you, many suppliers allow you to pay a variable monthly direct debit whereby you pay off the full balance each month. The good thing about this is you always know where you stand - the bad thing is your bills can be much higher in the winter which can be challenging for those on tight budgets.

Hope this helps

Brie

Most energy companies follow this practice to force people to pay a higher than necessary DD and build up a substantial credit balance which they then will generally refuse to refund in full.  

Presumably if you are with Eon you have a smart meter and so could move to a variable DD instead so you are only paying for the energy you actually use each month.  You need to be comfortable having to pay more in winter than in summer.  And I would suggest that even with a smart meter you should sense check your readings perhaps quarterly.  

victor2

I have just been through a similar "discussion" with Eon Next. The tariff ends in September and I aim for a zero balance by that time. 
They refused to move so I have switched to a variable DD and will look at new fixes with them or elsewhere once the account is in the penalty free switching window.
This is the Next Pledge Tracker V2, and recent statements say the Penalty for switching early is None, but it doesn't say that only applies if you switch to another Eon Next Tariff. It's £25 per fuel if you switch to another supplier.

Swipe

victor2 said:

This is the Next Pledge Tracker V2, and recent statements say the Penalty for switching early is None, but it doesn't say that only applies if you switch to another Eon Next Tariff. It's £25 per fuel if you switch to another supplier.

Be careful with the 'None' against exit fee on your statement. I've had that since my March statement on my Eon Fix V6 tariff so I called them. Eon Next has confirmed that I do still have an exit fee. They said, if it pops up a message when you attempt to switch, you will get charged and it won't be refunded. So, the easiest way to check is to try to do a switch but then cancel if it pops up a message about exit fees.

Swipe

In the OP's case, I'd consider topping up with a one off payment of £60 and see if that changes their mind. If they switch to variable direct debit they'll still have to pay off that debit anyway.

victor2

Presumably you can switch to their standard tariff with no fee, then switch to another supplier without paying a penalty, if you're desperate to leave.

Netexporter

Can you not just change the DD from month to month, like with Octopus? It's the same billing system.

Swipe

Netexporter said:

Can you not just change the DD from month to month, like with Octopus? It's the same billing system.

Only if you are in credit over a certain amount

spot1034

victor2 said:

Presumably you can switch to their standard tariff with no fee, then switch to another supplier without paying a penalty, if you're desperate to leave.

Assuming that they don't have software running in the background that will impose the fee if you leave before the anniversary of your fix has passed. I have no idea if they do this or not, but it just seems too easy to switch to another tariff within E.On Next without an exit fee and then leave them from there, and that very simple action alone just cancels the early exit fee from your original fix. I'd be interested to get the definitive word on this as I would be in that situation myself at present, though I'm not thinking of leaving them right now.

victor2

spot1034 said:

victor2 said:

Presumably you can switch to their standard tariff with no fee, then switch to another supplier without paying a penalty, if you're desperate to leave.

Assuming that they don't have software running in the background that will impose the fee if you leave before the anniversary of your fix has passed. I have no idea if they do this or not, but it just seems too easy to switch to another tariff within E.On Next without an exit fee and then leave them from there, and that very simple action alone just cancels the early exit fee from your original fix. I'd be interested to get the definitive word on this as I would be in that situation myself at present, though I'm not thinking of leaving them right now.

You would think they have systems in place to catch that, but I wouldn't be surprised if they don't. I can wait on the reduced tracker rate until August anyway, and hope there's a good fix around then to switch to penalty free.
Would be interesting to hear if anyone has done it though.