Out of the blue credit direct debit increase

Anglia_Sailor

Hi I'm in credit for my gas and electricity. Out of the blue my supplier wants to jump my payments £12. I think this is a scam to finance their acquisitions hunt using UK consumers money. I said no way and told them I would take them to Offgem. Any other forum members experience this behavior?

QrizB

Welcome to the forum!

Hi I'm in credit for my gas and electricity.

How much in credit are you?

At this time of year - late summer - most people who are paying by fixed budget direct debit would expect to be in credit by an amount equal to 2-3 months DD payments. This is to prevent your account balance falling below zero overtime the winter, when energy use generally increases and monthly bills exceed the monthly DD.

I think this is a scam to finance their acquisitions hunt using UK consumers money.

I think you're mistaken.

I said no way and told them I would take them to Offgem.

Ofgem don't accept complaints from individual customers.

Any other forum members experience this behavior?

It's entirely normal for a supplier to review DD payments at least once a year.

Ayr_Rage

Once again, it is not a scam, you are just annoyed.

It sounds like a completely normal reassessment in view of the anticipated price increases at the next price cap round.

Exactly how many months are you in credit and is that based on ACTUAL bills and not estimates?

You cannot take them anywhere for normal business practices which it seems you do not understand.

Robin9

You may be in credit now but if the DD is unchanged will you be so come March time.?

My elec is £250 in credit as of now but that will all be wiped out by March.

gpman

https://forums.moneysavingexpert.com/discussion/6680165/out-of-the-blue-credit-direct-debit-increase

I'm afraid your supplier will see this as an empty threat; they know that Ofgem does not consider individual consumer's complaints.

I suggest you talk again to your supplier, ask them to explain why they think you need to increase the monthly payment (they have to explain under their licence conditions) and try to negotiate an agreed figure you would both be happy with.

Ultimately, you will only end up paying for what you have used. Too high a DD will see your account in credit, too low a DD will result in the account in debit.

If the supplier allows it, and you are comfortable with it, consider paying the bill in full via DD at the time it is produced. .Often referred to as MVDD (Monthly Variable Direct Debit), but can be known by other terms.

la531983

Given you would get all your credit back should the supplier go under or if you move providers, or you would have to pay the extra should your payments not be enough, can the OP explain where the "scam" is?

Reed_Richards

Am I not right in thinking that Ofgem have asked suppliers to move to a regime where the customer's credit balance is always positive? Whereas in the past the aim was to maintain an average credit balance of zero, so accounts would typically be in debit in the winter and in credit in the summer? Therefore Ofgem would probably approve of the £12 increase, although, as stated, they don't accept complaints from individual customers.

Scot_39

https://forums.moneysavingexpert.com/discussion/6680165/out-of-the-blue-credit-direct-debit-increase

Out of the blue or simply tge reality versus post Iran war - as driving most of the 13% rise in the dual fuel cap in July.

Which actually was split iirc c6% on electric untit rates and a much higher c27% on gas unit rates - which will realky hike bills for the c85% on gas on variable or new fixes come winter if lasts..

And I am guessing not likely to fall as much as many might have hoped prior to mid July given recent UK wholesale gas rates returning to spring peaks c150p/therm after the July flare up in Iran.

With the new cap window averaging period just closed - and the Oct cap announcement due mid next week - I fear it mighg not bring good news for many as we enter early winter.

And I havent looked for last few quarterly reports, but when followed upto about a year ago - average credit balances were dropping, despite Ofgem - read govt - advice to suppliers is to avoid consumer accounts going into debit.

And so yes excessive positive credit and negative debit balances are already monitored by them, to prevent any such "scam".

Credit on accounts is now operating for many on a minimum absolute zero balance on annual cycle - including essentially arguably 1 month unbilled use margin at 1 of the big 6 (Ovo 1m balance Mar to cover use until next bill iirc) and zero balance at end of April Octopus.

I am currently less than 2m annualised DD in credit - which is if anything low goven my higher electric winter heating bills can be treble summer ones - and i raised my DD to cover my July cap predicted annual cost increase of £50 myself, before my supplier recalculated it..

I also dont typically need much if any space heating to late Oct / sometimes mid Nov - so will have built up another 1/2 -1 month or so credit by then.

EssexHebridean

You can work through your use and establish whether in fact the increase is justified, because the supplier does have to ensure that any increase they ask for is fair and reasonable. If doing that though, ensure you also account for any increases in rates that could occur over the next 12 months - and there are expected to be some. Even if you are in a fix now, you may not be for the full 12 month period going forwards.

Ultimately you need to decide whether your time is well spent challenging this further over £12 a month that you will easily be able to claim back later if you find yourself in excess credit.

Scot_39

just to add to above, CI latest cap predicting another 4% rise in Oct, and concerns will also rise into Jan.

split based on a quick check against averwge Ofgem rates c2.2% and c7.8% on gas.

not that thse will be in the 12% yet - but showing the general direction at for many the highest use months.

dunstonh

I said no way and told them I would take them to Offgem.

Excellent. That means you must have done your calculations and have the work-ins for them. After all, no serious person would complain without actually checking their information first. (not that you can go to ofgem).

So give us your usage details etc and we can check your thinking is correct.