Price hike?

victor2

I was with Octopus on a fix ending on January 1 and they twice said they were increasing my DD significantly, and their online system had a limit on how low you could reduce the amount (above what it had been). I explained to them via email that I calculated my DD to leave me close to a zero balance when the tariff ended. They just said their calculation looked ahead 12 months, going beyond the end of the tariff, but they did put it back to the amount I wanted. 

I've moved to a better fix elsewhere now, closing my account with a credit balance, which they promptly refunded me after I'd left.

I manage another account with Octopus, which I switched over to VMDD some time back. Done by return reply to an email request.

brilec

I have all the "accurate" figures. I have given them all meter readings every month religiously.

Saying I should go to variable DD is not answering the issue, which is, why do they think I will be using 20% more energy in the next 12 months compared to the last 12 months. 
Notice I said 12 months, we are not talking about increased use in the winter, as the fixed 12M rate takes that into account.

debitcardmayhem

brilec said:

I have all the "accurate" figures. I have given them all meter readings every month religiously.

Saying I should go to variable DD is not answering the issue, which is, why do they think I will be using 20% more energy in the next 12 months compared to the last 12 months. 
Notice I said 12 months, we are not talking about increased use in the winter, as the fixed 12M rate takes that into account.

No it doesn’t, if this winter is colder than last then you will use more kWh , the fix only means the cost stays the same rate per kWh if you use 200 more kWh than last year then that’s 200 x your rate extra cost.
Use more kWh you pay more.

EssexHebridean

brilec said:

I have all the "accurate" figures. I have given them all meter readings every month religiously.

Saying I should go to variable DD is not answering the issue, which is, why do they think I will be using 20% more energy in the next 12 months compared to the last 12 months. 
Notice I said 12 months, we are not talking about increased use in the winter, as the fixed 12M rate takes that into account.

Last winter was fairly mild as I recall - it may well be that the forecasts are for this one to be colder (Although it's not started off as such - November last year was a lot chillier if my gas use is to be believed!) If that is the case then yes, the change could well be to do with increased use in the winter. 

Anyway - if you have the accurate consumption figures then you can do precisely what I suggested at the start - get your sums noted down, work out what YOU think the DD figure should be (allowing for that 10% over and above your figures both to account for price increases and for fluctuations in temperatures) and then either simply readjust the DD through the app, or contact them via email or telephone and tell them that you believe your DD should be £xxx per month - and remind them of their duty to be fair in setting this. 

Scot_39

brilec said:

Can I just say, since I have been with Octopus, my credit balance has never been below £100, I have never been in debt to them. I was transferred from Bulb when they went bust, and never had a debt with them either.

I have reset the DD on the App, but they insist that my energy use will increase by 20% compared to last year, but no reason given. When I asked for a reason they just made the same statement again.

20% using the old 1C = 10% - rule of thumb is about 2 degrees C tempereature differential - inside likely to be a constant setpoint pattern for many - outside not.

It could be as simple as perhaps a forecast of a colder and/or simply longer winter.   

Or if cynical a ruse to build up their credit balance given their issues around new Ofgem financial resiliance tests.

I used to do my own DD sums based on 

(previous years consumption in kWh x new rates +standing charges at new rates - any credit) /12 - and then add 10% margin

- especially so if coming off a low use winter in the base data - my spread maybe 10 (over 15% one year) from now c8 year average from smart readings.

I know your maybe on a fix - but millions never are - nearly half households some years on SVT - more so during crisis when fixes became largely unavailable.

 

And for instance - for me - and I suspect many others - on all electric - the Jan cap now includes yet another increase as not fixed - so between Oct 3% and Jan 4.3% - that eats up another 7.5% onto DD (I cannot fix on E10 tariff at EOn - its variable only - tracking the multirate cap in general).  Another reason for adding a margin.

A much higher increase than the dual fuel 2%+0.2% nominal.

brilec

If they really are into long range weather forecasting, then they should make that clear.
Pity I didn't send this query into the Martin Lewis Show tonight, where he had Octopus CEO in hand.

I have told Octopus what I intend to pay and that I will watch how it goes and check that's what they take, as I have said, I have never been in debt to any energy company, and don't intend to start now, but I do prefer to know what my monthly outgoings are in advance so cannot see any possible advantage in switching to variable DD.

Oh and Martin made a big thing about the fact that if you are more than 2 months payments in credit you should ask for a refund. I'm well over 3 months in credit and they refuse to refund anything.

Scot_39

Well on that - as with on other things - ML is just wrong - and that hasn't worked at many suppliers for years.
Edit
What he apparently said is refund the extra - but your supplier actually has a requirement not only not to be in debit - but to be 5 weeks in credit - at tge end of tge winter - which shifts the bar even higher for balance now.

So if anything - under new rules - like Octopus's target to be 5 weeks in credit at the start of April - 2 months credit - pretty much the old normal for this time of year for many anyway - is likely to be inadequate to meet the new targets - which is for an always in credit account balance on annualised DD.

And so its easy to see 3 months - or more - for those using a lot of their energy costs in winter vs summer- being tge new normal.

I am on c2.5 months credit - and with the last 2 price rises - 3% in Oct and 4.3% coming in Jan - thats c 7.5% combined price rise imposed by govt policy - I really dont see it lasting the winter - with all electric storage / conventional heating.  And thats based on no debit - my sipplier hasn't yet imposed afaik the same additional - so one month by Mar like Ovo iirc , or 5 weeks like Octopus min credit.

Ildhund

Scot_39 said:

... my supplier hasn't yet imposed afaik the same additional - so one month by Mar like Ovo iirc , or 5 weeks like Octopus min credit.

How do suppliers assess one month's or five weeks' credit, I wonder. OVO's buffer is simply the no-frills estimated annual fuel cost divided by 12. The annual fuel cost is - for most established customers - usage for the past 12 months times the current unit rates plus a year's standing charges. 

This policy is proving very unpopular these days. It's probably not so alarming at the start of the assessment period - 1 April. The buffer is at that stage spread evenly over twelve DDs, so a surcharge of ~1/144 of the total annual payment each month. For those whose DD hasn't been subjected to a quarterly review since the 'one month's credit at 31 March' was introduced, though, there are now only only three or four months' DDs left to build up the buffer in. 

This time last year, OVO suddenly changed their DD calculation from aiming for zero at the end of winter to aiming for zero at the end of the winter after that. Great for debtors who can discount their debt over more than a year, while creditors see their balance remain unreasonably high for months on end. That change hasn't happened yet this year, but I think it will have to come soon - otherwise, some customers would see their DD being raised by 1/3 or 1/2.