Increase in DD again

born_again

Balance Nov (pre bigger winter bills £490.63
Highest winter gas & electric bill £170. 
Monthly DD £155.
Lowest balance £224.92, March Which after monthly DD was £379.92
Last months bill £110
Current balance after this months DD will be £478.86

Yet have been advised DD will go up to £187.29 a increase of £32.29 a month
Which they say is due to 
Current usage (under current DD by £40 even at worst was only £15 less than usage)
Current Balance (only £12 under Nov 24, all summer to come)
Future cost of energy. (will be decreased by 7% in July OK may increase later in year)

So if I stay on same DD & price stays same, that will add £200 credit (roughly by Nov) so balance would be £670 ish. £190 on last year.
Go with the increase DD & it will be over £800, £310 up on last year.


Are we really going to see such massive increase in energy prices in September, that require such a increase in DD?

I'm happy to carry a sensible balance to cover winter usage & increase DD at the time, as it allows me to balance outgoings. Variable is no good to me. As it effects other income.

Makes you wonder where they get their calculations from. As I noticed despite my monthly balance increase, the DD amount kept increasing. Just dropped it back to where it was at £155.

From 20/06/2025, you'll be paying £187.29 on the 15th of each month which includes £1.27 per month towards your target balance. (what's target balance?)

We recommend your payments should be £186.42 to keep your balance on track.

Clearly their system is not very good at maths. Unless prices are going increase by over 20% from Sept.

How we calculate your monthly Direct Debit amount

To calculate your monthly payments, we take your projected energy usage, work out how much that will cost on our tariff over the year, and divide it into 12 equal monthly payments.

However, predicting your energy usage is difficult – even an old bill won't always match what you'll use in the future.

So, over the year, we build up a more accurate picture of your usage in two ways:

1. By including your old supplier's record of your usage before you joined us.

2. By updating your projected usage as you submit regular meter readings.

Using this more accurate usage information, we can set your monthly payments so your account doesn't get into debt.

Already been with them 2 years.. Usage is consistent over that period. Have smart meter, so they know exactly each months usage,

Robin9

What do they quote as your Annual Consumption   - is this more than what you calculate ?

EssexHebridean

So what did they say when you presented your maths and usage figures and explained what your DD should be to be “fair and reasonable”? 

born_again

There is no annual consumption mentioned at all in the email.

Not spoken to them yet. I would give the poor rep hell at the moment & as someone who has worked on that side of the phone. It is not fair on them.👍 

Hoenir

Past couple of winters have been mild (compared to the historic norm). As a result consumption has been lower.  Being 100% precise with estimates is never going to happen. The energy companies are merely ensuring that no significant deficit exists. 

Easiest resolution is to pay quarterly for what gets used. This is ok for people that budget well unfortunately many don't. 

Swings and roundabouts. 

FreeBear

born_again said: There is no annual consumption mentioned at all in the email.

Look at your monthly bill. There should be a line somewhere that gives your estimated annual consumption (in kWh). You should also find an estimated annual cost (usually on the front page).

JohnSwift10

Or pay by variable direct debit if allowed.

Scot_39

Hoenir said:

Past couple of winters have been mild (compared to the historic norm). As a result consumption has been lower.  Being 100% precise with estimates is never going to happen. The energy companies are merely ensuring that no significant deficit exists. 

Easiest resolution is to pay quarterly for what gets used. This is ok for people that budget well unfortunately many don't. 

Swings and roundabouts. 

That's sounding like standard credit or the old SP system that also charged the premium and so may carry a 5% plus price premium last time checked £120 at cap tdcv per year.

If can budget month on month - does the OPs supplier do mvdd at dd discounted rates.

Not all do, Ovo iirc did but dropped. 

Scot_39

FreeBear said:

born_again said: There is no annual consumption mentioned at all in the email.

Look at your monthly bill. There should be a line somewhere that gives your estimated annual consumption (in kWh). You should also find an estimated annual cost (usually on the front page).

Afaik they have to provide a tariff table of rates and estimated consumption to use in switch comparisons. 

On EOn NNextmonthly statements it's on same page as detailed calcs - and the annual use updates monthly but not a simple sum of last 12 months.

They tend to put offers of savings in £s on the front page - like fixes or e7 or even sr vs e10 in summer months in past in my case

Scot_39

born_again said:

Balance Nov (pre bigger winter bills £490.63
Highest winter gas & electric bill £170. 
Monthly DD £155.
Lowest balance £224.92, March Which after monthly DD was £379.92
Last months bill £110
Current balance after this months DD will be £478.86

Yet have been advised DD will go up to £187.29 a increase of £32.29 a month
Which they say is due to 
Current usage (under current DD by £40 even at worst was only £15 less than usage)
Current Balance (only £12 under Nov 24, all summer to come)
Future cost of energy. (will be decreased by 7% in July OK may increase later in year)

So if I stay on same DD & price stays same, that will add £200 credit (roughly by Nov) so balance would be £670 ish. £190 on last year.
Go with the increase DD & it will be over £800, £310 up on last year.


Are we really going to see such massive increase in energy prices in September, that require such a increase in DD?

I'm happy to carry a sensible balance to cover winter usage & increase DD at the time, as it allows me to balance outgoings. Variable is no good to me. As it effects other income.

Makes you wonder where they get their calculations from. As I noticed despite my monthly balance increase, the DD amount kept increasing. Just dropped it back to where it was at £155.

From 20/06/2025, you'll be paying £187.29 on the 15th of each month which includes £1.27 per month towards your target balance. (what's target balance?)

We recommend your payments should be £186.42 to keep your balance on track.

Clearly their system is not very good at maths. Unless prices are going increase by over 20% from Sept.

How we calculate your monthly Direct Debit amount

To calculate your monthly payments, we take your projected energy usage, work out how much that will cost on our tariff over the year, and divide it into 12 equal monthly payments.

However, predicting your energy usage is difficult – even an old bill won't always match what you'll use in the future.

So, over the year, we build up a more accurate picture of your usage in two ways:

1. By including your old supplier's record of your usage before you joined us.

2. By updating your projected usage as you submit regular meter readings.

Using this more accurate usage information, we can set your monthly payments so your account doesn't get into debt.

Already been with them 2 years.. Usage is consistent over that period. Have smart meter, so they know exactly each months usage,

Target balance on annualised DD plans varies. 

In past heard talk of 1, 2 or 3 months DD by autumn credit or zero debit / small credit early spring.  That latter position formalised at likes of Ovo and Octopus - probably others.

But reality is suppliers can now model balances year round on a  monthly basis and set at any point.
And that includes sometimes their own forecast changes to market /  variable rates.

Ovo iirc are transitioning to no debit in cycle - with a transition target date of Mar 2026 for all those on annual plans.

Octopus have iirc a target of 5 weeks suppy credit in April.  Again essentially no debit in cycle.

The old concept of being a bit in credit in autumn a bit in debit by spring or average zero or nominal zero at some random annual review month in year (*) rapidly disappearing. 

Many years ago with EOn - before EOn Next - my annual review was July(*) - and they auto refunded iirc all credit if above a very small amount (less than a months use one year but more like 2.5 another - actual rules ?)  - and set DD to aim for zero balance following July.

Now some years my DD changes with cap almost quarterly.

I set my DD 2 months ago having cleared all but c£8 credit by Apr (they had reduced DD to repay over £200 credit earlier in year) to 1/12th of their Mar annual price change summary cost prediction.  They dropped it 12% after just 2 months - as I would have expected - been gaining small credit for next winter) .  Will see what the coming price change summary for July lower cap says - and if rate cut sees a new even lower DD calculation - otpr already factored in.

born_again

FreeBear said:

born_again said: There is no annual consumption mentioned at all in the email.

Look at your monthly bill. There should be a line somewhere that gives your estimated annual consumption (in kWh). You should also find an estimated annual cost (usually on the front page).

No annual usage for electric but gas shows as 9199 kWh subject to conversion, but does show amount. 
E £1598.00
G £653.53
Which strangely is £187.62 a month. Slightly higher than the DD quoted. But totally missing the £478.86 current credit. 😶‍🌫️
Increase in DD £32.29. Current credit over 12 months £39.90. So makes no sense.

Seems to me that someone in the working out of the background data, has not added a field to take current credit into account.

I do not want to pay by any other way that monthly as stated in 1st post. As that can effect my monthly income.

Email sent to see exactly what Octopus say