Diane227
Hi
Different companies have different rules but broadly speaking here's the way it works.
Yes, DDs mean you get a rebate on your overall yearly usage which is factored into your monthly DD.
Your DD is usually (and at my age you can guess that I've been with a lot of different providers) a set amount calculated by the company after looking at previous bills over the last 6 months.
It is then agreed to be £X which covers winter and summer usage so, instead of varying amounts, it's calculated over the year and divided into 12.
They should inform you if your usage starts to exceed the previously calculated usage figure and the DDs are not thought to be covering the usage.
You may have an agreement which enables them to take whatever amount is owed for that month via DD. That is something, in all my life, I have never done. It's always an agreed amount spread equally via DD over 12 months.
Now...you maybe don't know that it's not your provider who sets the amount in the first place.
It's a company (and there are different companies in different areas) who are 'employed' by your provider to look at your usage over the first few months and come up with a figure.
This can, after 6 months or so, at your providers discretion and if you make the request, be lowered if it's found to be too high even taking into account winter usage.
I can't remember the official name these companies (which monitor your usage over the first few months) are called but they're regulated by OFGEM and OFGEM sets the standards for low medium and high usage and your provider sets tariffs accordingly.
Did you know that the higher you are above sea level the more you pay for your gas and if you have an outside meter, you pay less for your gas.
Your provider has to give you notice before increasing the amount of your DD and they are obliged to refund you any amount in credit above £5.
You can, of course, refuse the Credit if you want a credit buffer in your account but that £300 of yours is earning them interest.
Imagine the interest they generate on all the accounts in credit...and they keep it.
I hope I've explained it fairly but without knowing the company, I can't be more specific.