ENERGY FIXED RATE TRAFIFF

motsi741

Can anyone tell me what a fixed tariff means with energy companies. I thought it meant the amount  paid each month would be exactly the same for the duration of the tariff.
Which is different from a price capp. but now I am being told I have and outstanding amount owing

la531983

Uh oh.

It means the amount per unit is fixed. It doesnt mean you can use all you like for a fixed amount. If you have used the energy you will now have to pay for it.

Woodstok2000

Fixed tariff means your unit rate is fixed, so you pay the same amount per KWh of energy for the duration of the contract.  The amount paid will still vary depending on how much energy you use.  For example, if your rate is fixed at 20p/KWh, if you use 50KWh, your bill for usage would be £10.  If you used 100KWh, it would be £20.

Standing charges etc are also fixed, but apply regardless of usage (usually daily).

dunstonh

Can anyone tell me what a fixed tariff means with energy companies. I thought it meant the amount  paid each month would be exactly the same for the duration of the tariff.

Oh dear.   No, it doesn't mean that.  It is not an all-you-can-eat tariff.     The unit price is fixed.     So, it is your use multipled by the fixed unit price.  If you use 200 units one month and 300 the next, you will pay a different amount as your use was different.

There is also the secondary issue of budgeting based on estimates.....

 but now I am being told I have and outstanding amount owing

...and this is the outcome if you don't pay the right amount each month based on your annual use.

You need to look at your bills to find out how many units you have used over 12 months.     Then you multiply that by the fixed unit price to give you the annual figure on your use.  Then add on the daily standing charge and possibly VAT (depending on whether you have included it already or not).        That will give you a ballpark estimate of your annual use and you can set your monthly amount to equal that annual amount.

As you now have arrears, you will need to add the value of your arrears onto that annual amount.   It is unusual to have arrears in December as most would have built up Summer credit and the heavy cold periods have only just started, with worse to come.    So, this all hints that your monthly direct debit was far too low.

FrugaiMacDugal

The fixed rate is the same, but the more you use the more you pay.

Your 'amount  paid each month' maybe not enough to cover usage.

motsi741

Thank you  very much everyone. I did not know that. I was frugal but I still ended up with a £1,350 oustanding. Ill just have to deal with 
Thank you

QrizB

motsi741 said:

Thank you  very much everyone. I did not know that. I was frugal but I still ended up with a £1,350 oustanding. Ill just have to deal with 

Has your supplier been receiving smart meter readings automatically, or have you been sending readings manually?

Have you been receiving monthly bills from your supplier? If you have, have you been checking them?

WiserMiser

Consider Variable Monthly Direct Debit.  You, a smart meter or a meter reader send a reading each month, you're billed for the exact usage, it's paid in full by DD and that's that.  No nasty surprises many months later.

Effectively that's how it worked back in the Electricity and Gas Board days (although the meter reader called quarterly and you paid by cash / cheque in the High Street or by post).

Unfortunately, not all suppliers offer VMDD (thanks, dozy Ofgem) but the better ones such as Octopus do, although you may have to call or email as it's often not mentioned online.

May not suit everyone because winter bills are higher than summer, but it puts you in full control.

pseudodox

WiserMiser said:

Consider Variable Monthly Direct Debit.  You, a smart meter or a meter reader send a reading each month, you're billed for the exact usage, it's paid in full by DD and that's that.  No nasty surprises many months later.

Effectively that's how it worked back in the Electricity and Gas Board days (although the meter reader called quarterly and you paid by cash / cheque in the High Street or by post).

Unfortunately, not all suppliers offer VMDD (thanks, dozy Ofgem) but the better ones such as Octopus do, although you may have to call or email as it's often not mentioned online.

May not suit everyone because winter bills are higher than summer, but it puts you in full control.

If you take the VMDD option copy my mindset which tells me my bills are normal in winter for a country with a cold climate.  In summer I enjoy the bonus of bills which might be half or even a quarter of the winter costs leaving a nice wodge of available cash to spend on ice cream, holidays, etc instead of it sitting in the energy companies coffers.

EDF offer MVDD.  Control of my energy accounts takes all of 5 minutes per month to read meters & submit the numbers.  Another couple of minutes to double check the bill is correct & a quick look 10 days later to see the DD has been paid.

Seems to be a lot of people here spending a lot of time calculating projected usage/costs, going online, adjusting their DD payments up & down, disputing the FDD amounts requested, emailing/phoning the company to negotiate etc etc.  If you have to keep moving the goalposts you might as well be on MVDD & go do something more interesting with the time saved.