OVO doubling my direct debit payment when I'm 4 months in credit

WiserMiser

victor2 said:

pseudodox said:

OVO don't offer variable DD - not unless they have recently changed policy.  Another reason I ditched them.

Apologies. I foolishly believed Google's AI overview that said OVO did. It does appear they do not. Many suppliers do though, so maybe it's time for the OP to switch? That'll get the credit back!

OVO used to offer Variable Direct Debit but they no longer do so.  Ditch & Switch to a friendlier company is the answer.

pseudodox

victor2 said:

pseudodox said:

OVO don't offer variable DD - not unless they have recently changed policy.  Another reason I ditched them.

Apologies. I foolishly believed Google's AI overview that said OVO did. It does appear they do not. Many suppliers do though, so maybe it's time for the OP to switch? That'll get the credit back!

I always skim straight past anything AI.  Full of errors & out of date "information".

Scot_39

You have said what your DD is - and what they want to set it to - and what your current credit is - bit critically not what your annual - and more to the point - winter / vs summer use / costs are.  

Credit and DDs get confused once they start adjusting one for the other - and so it's key to keep an eye on that - and then remember say any temporary DD reduction is just that - and it will end - and then the price will jump.

Ive had my DD drop temporarily by upwards of 25% in the past to clear several months credit.  If let that run out - and surprise surpise - a much larger figure came along - I estimated would be closer to 40% increase as the cap was a bit higher - plus putting the 25% - which of course was 33% of the lower DD back.  So I took half the credit back - and got half the rise immediately on my DD.

Ovo have a standard way of supposedly calculating annualised DD - and it's based on positive credit balance in Mar - for existing customers.

[Theres an Ovo user who thinks like past years - that Mar target will slip to Mar27 soon if not already done so to avoid an excessive demand.]

https://www.ovoenergy.com/help/article/how-do-direct-debits-work

If £141 DD was realistic annual/12 though - £690 nearly five months if includes recent use deduction based on reaql measurements - I would have thought more than enough credit - in fact for many maybe a couple of months too high.

Gather your numbers - look at your last statement for annual kWh estimates - in the tariff summary section on my EOns bills.

Do the maths - and phone them - running through the maths as need be.

Myci85

I used to have this issue all the time with NPower, they would send out their annual estimate of usage and tell me they needed to increase the dd, even though I calculated that what I was currently paying would more than cover their own annual calculation over the year. I would call up, spend ages explaining the calculations to them, they would eventually agree I was right and reduce the payment, and then a few months later they'd increase it again. I can only assume they receive interest if they have hundreds of pounds of customers overpayments sat in their accounts? If not, I've no idea what they gain from it, as they regularly would end up refunding me a large excess on the account. 

I'm now with Octopus and thankfully no such nonsense with them. They've been by far the easiest energy company to deal with. 

Ildhund

ElizaDay58 said:

At the moment I am £690 in credit.

OVO has what they call a 'live billing' system. For those with a smart meter, and an account set to return data half-hourly or daily, the balance changes each day to reflect the previous day's usage. A snapshot of the credit balance doesn't therefore mean very much - it will be lowest the day before the DD is taken and highest just after. Customers with non-smart meters may see the same behaviour, based on estimates of the daily usage. Just to illustrate this, here's a chart showing my own account balance over last month. The account balance increased more than tenfold overnight to DDDay ...
  



The amount of the DD is based on the Future Annual Consumption (FAC) estimates, supposedly based on past usage. Many cases of immoderate DD suggestions can be traced to a fanciful FAC. You can check what they estimate for yours on the Plan page in your online account. How does it compare to your actual consumption over the past twelve months?

There is a Direct Debit Calculator in the online account that shows clearly where the recommended DD amount comes from. You can see what effect changing the DD would have on the account balance in the months up to the end of winter. Apart from the new requirement of having one month's costs in credit at the end of the period, does the charted balance look unreasonable? Why?

Remember, too, that agreeing to pay by fixed monthly Direct Debit involves an undertaking to keep the account in credit. It is no longer acceptable - as it once was - to allow the account to fall into debt during the winter.

EssexHebridean

Ok - first off the supplier is not allowed to increase your DD to an unreasonable amount so if in fact their demand is unreasonable, that is challengable.

First steps though as Matt said previously - you need to work out what IS reasonable, and this means establishing your annual usage of energy in your household. You ideally need to get two bills 12 months apart to establish this - and the bills need to use either correct smart, or actual (by you or a meter reader) readings. Once you have those figures you can work out a rough approximation of your annual cost using current unit prices and standing charges. I would suggest then adding 10% to that figure (to cover a colder winter than last year plus any changes in price through the year), before dividing by 12 - and hey presto, there is your monthly figure.

If the monthly figure you arrive at is a lot lower than the amount OVO want to take by DD, then present that figure to them and explain that you have calculated what your DD should be set at, here is the figure, and that if they want more than that, they need to explain why, because your calculation uses actual usage figures and includes a contingency amount in case of extremes of weather. 

If you need more on this, Martin has done several bits in his podcast on the subject - although going back a few months now. Well worth a listen to explain the right approach to customer service to challenge things, and what you can do if they refuse to accept your calculations, but for whatever reason you don’t want to change supplier.