Daft question - Ovo DD

Altior

Ordinarily this wouldn't bother me, but for various reasons I'm going to be extremely squeezed over the next six weeks or so, literally monitoring the pennies.

By coincidence, I'm switching energy contracts away from Ovo. It should be completed by the start of next month, I'm still in the cooling off phase.

I have a significant credit balance, I will be getting a refund. As I'm switching away, I have to wait until the final bill and they'll send me the refund (fine), it won't be for SIX WEEKS after the final bill (not fine!).

I get it, some people won't be on of top their accounts, misreported reads or whatever, so not refunding until the final bill is generated is understandable. Not so the six weeks holding time, after the closing position is determined. But the critical element for me here is that they also expect me to pay another DD, even though there is a large credit balance. I will also be paying the DD for the new supplier, so effectively a double charge when I am currently three months in credit for domestic energy.

It's certain they will be giving me a refund, after I instructed the switch, they asked for readings on that day so my credit balance is live and accurate. Obviously this time of year, bills are less than the DD to build up credit for the winter, so that position won't be reversing inside a fortnight.

TLDR: Is it OK credit report wise to cancel a DD with an energy supplier when I have a large credit balance, before the final bill has been generated (in my example, the supplier is Ovo). I'm thinking it's fine, but would like some reassurance from anyone itk, thanks!

luci

I was going to suggest what you went on to say. If your credit is more than your DD amount, you could cancel the DD before it is due. Hopefully that helps you a bit.

Altior

https://forums.moneysavingexpert.com/discussion/comment/82080528#Comment_82080528

Thanks! I realise it is nudging, but their communication makes it sound like you must keep the DD in place.

I do appreciate that some people will switch with debit balances, in the winter et al. And a human isn't reviewing my account and stating that taking another DD is daft. The terms of closure are onerous though, I think four weeks for a final bill, then a further six weeks to pay the refund! The only concern really is avoiding any negative reporting to CRAs, I think energy companies can be pretty awkward.

TroubledTarts

Maybe cancel the switch, ask for a refund of the credit and then switch after.

Altior

https://forums.moneysavingexpert.com/discussion/comment/82080544#Comment_82080544

Thanks for the suggestion. I actually ran a new comparison and the new deal has gone, with the best on offer being tangibly more expensive. I can manage if there is no way around another DD being taken, but it's much more of a faff. And as I allude to, rather daft as they will just be returning it to me in ten weeks.

QrizB

With most energy suppliers, when you cancel your DD they will no longer refund to that bank account via bank transfer. Something to do with not being able to verify that the account still exists, I think.

Your refund will probably come via cheque.

Swipe

Call them, explain the sitution and ask them to set the next DD amount to £1.

luci

https://forums.moneysavingexpert.com/discussion/comment/82080537#Comment_82080537

I've just realised that I may have given you duff information, sorry.

You should really keep your DD open, as that is how they will refund your credit balance. Otherwise, you will have even longer to wait for a cheque.

Edit - I posted again before reading the comments after my one, which all seem to be in agreement.

tim_p

Is the “significant credit balance” in line with your calcs and based on Actual meter readings or Smart meter readings?

Altior

I have manual meters. My energy use is pretty consistent (live alone, similar habits), so the real readings were close to the estimates.

Thanks for the advice folks. I've changed the direct debit date to the 24th.

I created the switch on 20th July and they've asked me to submit a reading on the 2nd Aug. That should mean the new supplier takes over from the 3rd. Final bill takes 10 working days, so should be before the new DD date.

I will call them on Monday though to run it past them. Ironically enough a cheque might be more useful as I have some leeway with regard to when it's banked, the critical element is that I don't want any more funds taken.

Scot_39

Your refund is due in 8 weeks normally from switch date - sometimes quicker - or your due compensation. That 8 based on a max 6 weeks to final bill or you get £40 comp and then 10 working days to refund (is there another comp - not sure - anyone ??).

Both are Ofgem limits. Ovo should comply.

Id say dont cancel the dd if not desperate - you could try lowering it yourself on line - my supplier only allows iirc 15% when in credit - or phone as above if think need more - if not smart meter - most will also need recent readings entered. If in a lot of credit they might recalc a lower number anyway on new manual readings - but maybe only by 12th excess..

Ovo will normally use reverse credit based on the DD info - or refund could be delayed beyond the 10 days. At least one supplier only refunds electronically - no cheques - according to one poster here who reported had to re sign up to dd after cancelling to avoid a payment been taking.

[Although its often best if cash needed in a hurry to request a refund then switch - you might find it wasnt - or at least wasnt all available - for refund anyway.

Suppliers have varying views of what is an adequate balance vs old traditional cycles - and so mayve your significant balance view. Ovo are likely to expect over 2, maybe 3m plus any as yet unbilled usage of ave DD balance at this time of year (having a 1m requirement at end of Mar iirc). My supllier has a zero min basis, and im already near 1.5 months dd in credit as of june - july usage deduction.. And if anything its a liittle low vs past years given July cap rise.]