Am I banking with my Energy company?

[RonA]

Just had my domestic dual fuel energy bill in from Dec19-Jun20 & Im in debit to the tune of £15.
Just before Dec my monthly payments were upped from £106 to £121, now the Energy company is reducing the direct debit back to £106.
By my reckoning, now we are into the warmer months my consumption will be no where near £106 per month, am I effectively now banking with my Energy company & giving them a free loan?

Why can we no longer just pay for our Energy as we use it, as times of yore.

I know they argue the give you a discount for direct debit & dual fuel but is this just another cynical big business con trick?

RonA

 

[lincoln2013]

Yes you are & if you change to another energy company they are reluctant to reimburse money that has been overpaid.

 

[Morrisman]

Tell them you want a fixed bill each month, not directly debit. They will then argue you have to pay more for your electric.

I use Bulb, they tell me when I am paying too much and suggest I drop my direct debit, but its no big deal, not like they are earning massive sums of interest on the few extra quid they are holding.

My dads pay most of his bills monthly, when the bill arrives. I cant be bothered with it, just keep an eye on it, all done online.

 

[tom2207]

Just treat it as a lay away ,,, if you had an extra , say 100 pounds in the bank , just how much interest would it be making today ,, your worrying about less than the price of a snickers ,,,,lifes to short to worry ,,,,,,,,, just my thoughts

 

[daleyd]

Swings and roundabouts - in winter your bills would be much higher, so it evens itself out.

 

[Fraserb]

We pay £170 a month for our electric, art eh moment we're well in credit but over the winter that reduces to almost zero or sometimes in debt, Id rather pay the same all year and have some credit going into winter than reduced bills in the summer and big bills in the winter.

 

[angellonewolf]

yea right discount for direct debit thats been calced in to the charges you just pay more if paying every 3 months

and yes they worked out if everybody just paid every 3 months they get nothing extra by 80 percent of people paying even if they are not paying over the top thats £300 a month in there bank for every person that must mount up to millions and at .5 percent thats good amount on intrest every 3 months yes there making a killing

 

[julianf]

Our company request meter readings occasionally but will take them whenever we want, and adjust the billing accordingly.

If I could be bothered to submit a reading every day, the bill would be 100% accurate all of the time.

No reason why any company shouldn't be able to do that at this point in time.

 

[RonA]

Swings and roundabouts - in winter your bills would be much higher, so it evens itself out.

No, that’s my point it isn’t evening it’s self out. They upped my payment before Dec & as I’m only £15 in debit, I’ve just about paid the right amount for the winter period. Logic would dictate they should reduce my payments below £106 to take account of reduced energy use in the summer. Admittedly they’re probably only making a small amount of interest on me personally but spread across their consumer base, I would argue it could add up to substantial sum.
PS I have a smart meter which takes hourly readings
RonA

 

[500e]

But does it work Ron so meany don't

 

[daleyd]

No, that’s my point it isn’t evening it’s self out. They upped my payment before Dec & as I’m only £15 in debit, I’ve just about paid the right amount for the winter period. Logic would dictate they should reduce my payments below £106 to take account of reduced energy use in the summer. Admittedly they’re probably only making a small amount of interest on me personally but spread across their consumer base, I would argue it could add up to substantial sum.
PS I have a smart meter which takes hourly readings
RonA

But are they not saying that the £106 should be somewhere near for the monthly figure to cover the cost of your energy year round? If you’ve not long been with them they won’t know how much you use, so they make a guess and then adjust up/down accordingly...not forgetting the price they pay for it fluctuates as well. The ones I’m with adjust a few quid here and there, they get it about right then I change supplier and it starts again, it’s never enough to worry about.

 

[hotponyshoes]

If the interest rate on my business account is anything to go by they won't be making any money on the £20 a month you might be lending them until winter.

If they took £100 extra from every customer and had a dedicated team in a back room playing the stock market or issuing sub prime loans with the customers money I suppose they could make a few million over the summer.

I suspect that for ease of business administration and regulatory compliance the extra money goes into a secure holding account and is transferred into a operational account within a few moments of your bill becoming due.

Our company request meter readings occasionally but will take them whenever we want, and adjust the billing accordingly.

If I could be bothered to submit a reading every day, the bill would be 100% accurate all of the time.

No reason why any company shouldn't be able to do that at this point in time.

Mine do this as well.
As other guys have mentioned above, life is too short and the interest rate is too low for me to bother doing anything other than paying the estimated readings and letting the guy read the meter once a year.
If I wanted to save up the £100 myself and lend it to somebody who would probably never pay it back at a 250% interest rate all I would need to do is submit my actual reading online (pretty sure you can also download the app or text/phone it in). I think the cut off point is 5 days before the bill is due.

 

[jimbo84]

Our previous supplier (shell) had the option to select an average direct debit, sounds like what your on, or select an as used amount for no extra charge, you provided them with a monthly reading and the direct debit would be for the amount used.

They were useless though so we switched, with EON now, they do the direct debit to whatever they see fit, it was way higher than what we use but managed to get it changed.

Always have problems with suppliers as we use such a small amount compared to the averages.

It was only £20 a month over but I refuse point blank to let these very large companies take extra money from the general public to have sitting in their bank accounts earning them interest. Think about an average of a tenner per customer (it's probably way higher) and how many customers they have, it'll add up to a fair few million quid earning them a nice extra profit, on top of the profit they already make on having you as a customer it's no wonder they offer a discount for direct debit it'll be making them a mint.

 

[tlovatt]

No, that’s my point it isn’t evening it’s self out. They upped my payment before Dec & as I’m only £15 in debit, I’ve just about paid the right amount for the winter period. Logic would dictate they should reduce my payments below £106 to take account of reduced energy use in the summer. Admittedly they’re probably only making a small amount of interest on me personally but spread across their consumer base, I would argue it could add up to substantial sum.
PS I have a smart meter which takes hourly readings
RonA

The idea would be to set your rate so that it averages over the whole year, if they had to increase the direct debit a bit before winter you had previously not been paying enough to quite cover your average bill, if they lower you payments further now you would have a bigger increase next winter as you would not have built up sufficient credit.

It is not actually the energy companies that push for the constant direct debit, it seems to be consumer / regulator driven and where companies increase their charges over the winter they get panned for it. Some companies will agree to charge for what you use but generally want a months payment up front and then to bill for what you use, talk to your energy supplier.

Also some companies will pay interest on credit balances such as OVO and the longer you stay with them the higher the interest rate - although I just go with the absolute cheapest company (turn off all the warnings on the comparison sites and get the ones that are a bit financially suspect with poor customer service, they can be a lot cheaper)

 

[TechnicAl]

Ive just switched from British Gas to SSE......so far Ive had 6 final bills from B Gas, ranging from £97 to £595.....their last instruction was for me to get the meter readings from SSE.....Ive got British Gas smart meters......Incompetent
Ive paid nothing so they can sort themselves out.

 

[gaz1]

Just had my domestic dual fuel energy bill in from Dec19-Jun20 & Im in debit to the tune of £15.
Just before Dec my monthly payments were upped from £106 to £121, now the Energy company is reducing the direct debit back to £106.
By my reckoning, now we are into the warmer months my consumption will be no where near £106 per month, am I effectively now banking with my Energy company & giving them a free loan?

Why can we no longer just pay for our Energy as we use it, as times of yore.

I know they argue the give you a discount for direct debit & dual fuel but is this just another cynical big business con trick?

RonA

its just a big rip off with direct debit payments they up there amounts to what they think you use on other peoples usages not yours

and as goes for direct debit discounts it should be for all payments not just for direct debit customers is my biggest gripe here

dual fuel you have to be careful with if you refute or refuse to pay one bill they can and do cut off both gas and electric systems

 

[mike os]

they like you to be in credit... that shows as cash in their account and also earns them interest... it might only be a few quid to maybe 100 per customer but when you have 500000 customers thats a lot of cash and even more interest/stocks/investments they can make with your money

I change my payments every few months to make sure im only a few quid in credit, they dont like it but thats not my problem

 

[Morrisman]

Ive just switched from British Gas to SSE......so far Ive had 6 final bills from B Gas, ranging from £97 to £595.....their last instruction was for me to get the meter readings from SSE.....Ive got British Gas smart meters......Incompetent
Ive paid nothing so they can sort themselves out.

About 15 years ago I was with British Gas, paid by direct debit, no problems. Then one day I get an email telling me they were raising my DD from £50 a month to £120. No mention why.

I cancelled the DD and told them I would send a reading and they could then send me a paper bill every month.

They then told me it was a computer error, but I wasn't buying that.

 

[Morrisman]

The idea would be to set your rate so that it averages over the whole year, if they had to increase the direct debit a bit before winter you had previously not been paying enough to quite cover your average bill, if they lower you payments further now you would have a bigger increase next winter as you would not have built up sufficient credit.

I wonder if they would have a grump on if we all averaged our DD out, so we owed then in winter, they owed us in summer? By rights that's exactly what should happen.

 

[Fraserb]

Can't believe I'm about to type this but Scottish power have been pretty much spot on here, when I first moved into this house filled in their calculator online to estimate usage and they chose an amount to start the monthly payment at, they encouraged you to enter meter readings online regularly to start with to check you were paying roughly the correct amount, they tweaked it a few times in the first 6 months and since its been fairly stable.