OVO Direct Debit Increase

StingyBuyer

I'm in credit with my OVO account but they have suggested my direct debit is increased from £324pm to £474pm. The reason they have given is that they now insist that you are 1 month payment in credit by 31st March (last day of the financial year hmmmm).

Im trying to clarify if they can enforce this under fear i.e. they notify me of change in writing and take the amount. If I cancel the direct debit they up my tariff.

I cant seem to get any other answer than this is the new policy. Anyone had any experience?

Im in a fixed term so have exit fees or I'd just up and go.

MattMattMattUK

https://forums.moneysavingexpert.com/discussion/6657036/ovo-direct-debit-increase

Yes they can increase the Direct Debit to keep you one month's payment in credit, they are required to do this because of Ofgem requirements. It has nothing to do with the end of the financial year for a few reasons, firstly it would be cash in bank but it would also be a liability, secondly because Ovo's financial year ends on 31st December not 31st March.

They are not enforcing this "under fear". If you cancel your Direct Debit you go onto the more expensive "pay upon receipt of bill" tariff, that is standard and no attempt to threaten is part of that.

There is no point in changing supplier unless you move to one who offers MVDD (Octopus and a few others) and opt for that, as otherwise they will all be required to keep you at least one month in credit.

StingyBuyer

Interesting. And thanks for the feedback.

MVDD? Is that a fixed rate DD for the year. Thats what I'm after as my DD flip flops with OVO currently which is painful for monthly budgeting.

WiserMiser

Welcome to the forum.

You can have a Monthly Variable Direct with a Fixed tariff or with a Variable tariff, it makes no difference.

It means you pay the whole bill in full, so more in winter and less in summer.

However, some suppliers such as Ovo don't offer it. Octopus do, but you have to phone or email to get it.

la531983

https://forums.moneysavingexpert.com/discussion/comment/81900633#Comment_81900633

No it isnt, the V is for "variable".

What you are looking for (a provider that doesnt vary the DD every month, and a provider that doesnt want you to be a month in credit) simply doesnt exist, as far as I know.

Ayr_Rage

Monthly Variable Direct Debit.

You get billed every month and you pay in full by DD, getting the DD rates rather than pay on receipt of bill.

This means large bills in winter and much smaller in summer so not great if you cannot budget according to usage and put funds aside for the large winter bills.

gpman

https://forums.moneysavingexpert.com/discussion/6657036/ovo-direct-debit-increase

How much does your energy supply actually cost per year?

How much credit have you currently in your Ovo energy account?

£324 pcm = £ 3888 pa

£474 pcm = £ 5688 pa

Typical average cost of consumption for a dual fuel customer on the Pants Cap is £ 1758 pa

(and announced yesterday, it would reduce on 1st April to £ 1641 pa)

To address your question more directly, I cannot see any reference to the requirement as you express it within the t&cs you presumably agreed to

However, what I do see is:

"3.8 …

If you’re an existing member we can ask you to pay a security deposit at any time if it’s reasonable for us to do so (for example, if you don’t pay charges to us by the date they’re due or if you steal energy)."

So they could ask you to pay a security deposit equivalent to 1 month average supply cost (or any other reasonable amount)

pseudodox

Everyone heats their home differently & depending on number/age/ health issues of occupants the cost will vary enormously but I find the above figures staggering! Are you heating a small hotel or care home perhaps? I think more context is required for anyone to really give useful feedback.

(As a single householder in a large tricky to heat house I stay comfortable (but not cooked!) on around £1000 dual fuel per annum. February's bill (variable payment, short month) set to be £140, last June was £47.

IOWJJBTM2025

A high user (4100 units Electric / 17000 units Gas) on Current Energy Cap would pay £2454 per year - this reduces down to £2085 per year in April.

You are currently in credit and we are nearly through the Winter. Once we get past the next couple of months anticipate your monthly usage will reduce.

OVO are saying that £3900 per year is not enough and they want £5700 per year.

Suggest you work out how much energy you use annually and then calculate how much the annual cost is.

Based on the annual cost call OVO and tell them what you are willing to pay. £5700 per year sounds a lot.

Are you tied into OVO? Maybe with being a high user you can make savings with an alternative supplier?

StingyBuyer

https://forums.moneysavingexpert.com/discussion/comment/81900740#Comment_81900740

My bills for the year equated to around 2880 per month and I'm 100 in credit with one winter month and one payment of 470 a month to be taken.

My usage patterns over the years have remained relatively similar. I'd rather pay a fixed 240/250 a month every month of the year than have cheap bills in summer and have to manage my cashflow myself.

gpman

https://forums.moneysavingexpert.com/discussion/comment/81901196#Comment_81901196

Thanks for that.

But I'm struggling to understand your numbers.

If you use £2880 pa and are currently paying £324 pcm (£3888), then you should ordinarily be a lot more than £100 in credit. More like £1000.

Did you recently come on supply with Ovo? Did Ovo recently increase your monthly payment to £324 pcm?

I really need some more clarification to assist you properly.

But at first sight, it does seem unreasonable that Ovo are now seeking £474pcm.

Based on the info you have supplied so far, I guess the £324 you pay this month will match the consumption cost this month, and next month you your payment/cost should result in almost another £100 credit, so with any luck you will be £200 in credit by end of next month, almost the £240 credit they are expecting.

I suggest you ask Ovo for a full explanation as to how they arrived at that amount. If you get a sensible response, please post their explanation here.

Otherwise escalate to a formal complaint and then off to the ombudsman if necessary. I really hope it doesn't come to that.

One thing you could double check is the estimated annual consumption in kWh that Ovo are assuming. Does that match roughly what you think it should be? I've seem some suppliers come up with some outrageous estimations that they cannot explain when challenged, and it may need the ombudsman to assist you in getting the supplier to resolve it - they like to blame the anonymous 3rd party data collector, but the data collector should be getting the data flows from the supplier.

I assume you are providing regular meter readings (or have a smart meter that is sending the meter readings to your supplier) and that your supplier is using those meter readings.