Fixed price energy deal

StarDreamer

Oldnproud wrote In answer to those who keep asking why people don't just pay for what they've used each month, it's because for many people, it is far, far easier to spread the cost over a year, rather than suddenly having to find many hundreds of pounds to pay a bill after a particularly cold winter month.

I don't ask people why they do what they choose to do.

I simply say what I do.

I have a separate current account, no cheque book, no debit card, just for electricity direct debits.

I pay a regular amount each month automatially to the account from another account.

And each month a direct debit payment is taken only for what I have used. So the money builds up over the summer yet is still in my bank account. Also, having the separate account means that if they try to take a vast amount, for whatever reason such as counterchanging the two readings by error, it will not affect my ability to buy goceries as that is charged to a different current account.

I know some people say it is complicated, but I don't look at it like that, to me it is partitioned and elegant. and works well in practice.

StarDreamer, your method does sound very efficient, and I imagine it would work well for anyone who has sufficient income to be sure that they will not need to raid that separate account, even in an emergency, and who is also organised enough to keep a regular eye on things to make sure they are running smoothly.

Elegant?

Oldnproud wrote In answer to those who keep asking why people don't just pay for what they've used each month, it's because for many people, it is far, far easier to spread the cost over a year, rather than suddenly having to find many hundreds of pounds to pay a bill after a particularly cold winter month.

I don't ask people why they do what they choose to do.

I simply say what I do.

I have a separate current account, no cheque book, no debit card, just for electricity direct debits.

I pay a regular amount each month automatially to the account from another account.

And each month a direct debit payment is taken only for what I have used. So the money builds up over the summer yet is still in my bank account. Also, having the separate account means that if they try to take a vast amount, for whatever reason such as counterchanging the two readings by error, it will not affect my ability to buy goceries as that is charged to a different current account.

I know some people say it is complicated, but I don't look at it like that, to me it is partitioned and elegant. and works well in practice.

*Yet what if a situation arises that the company providing the
energy on a "pay more now in the hope of savings later" contract goes bust*

That is why all our standing charges have gone up. It is us the consumer who has to pay for all these fly by night companies that offered great rates and then went under - doesn’t seem fair to me.

Your credit won’t be lost if the energy company goes bust, it will be transferred over to new provider, but maybe not immediately.

I've been waiting since last year for my credit with Green to be transferred to Shell.
A friend waited two years for her refund when her previous provider ceased trading ☹️

I pay by DD the amount Was £75 per month (I live on my own and very conscientious / careful where money is concerned must be an age thing )
Then last month they put my DD up to
£168 !!! Nothings changed in my usage of gas/electric I can’t cut down I do washing once a week don’t have a dryer, dish washer coffee machine air fryer ( are they any good cheap to use? )
Etc I mean how do I cut down
Oh I’m told I also can alter amount I pay by DD but they omit to say only if the “system” allows you to do so
It doesn’t I’ve thought about just cancelling DD altogether sod it! my bank account is being controlled by one of many companies who do it
Why ? Because they can !! And we as a country are moving forward life’s improved
Has it !!? I’m not so sure

Hi Oldnproud, my Mum gets pension credit and she is allowed £16,000 in the bank before her payments are affected .

Riverwalk

I pay by DD but just £50 and then pay the extra when the monthly bill comes in, this way I get the DD discount but no extra money is sitting in their account.

I'm with Octopus and send a monthly reading.

They put the DD up to £95 and I just went into my account and reduced it back to £50. I'm not sure if other companies' web sites allow this.

The important thing about a fix rate is what they are charging you per kWh, not what they set the DD at... the DD can always be reduced according to your usage.

It's easy!

My Mum is with British Gas. It seems they won't allow that.

She is still on a fixed deal, but it will end at the end of July. A couple of weeks ago, they announced that they were increasing her direct debit from £60 to £140 for the remainder of the contract.
I've checked her account, and she is still in credit (just), so I can't see how they possibly justify that increase now, in the summer months when her usage is not going to be high.
I tried to lower the DD online to what I am sure would keep her in credit, but 'the computer said no'. It said it would only allow me to raise it!

Between us, we've decided that it isn't worth ringing BG about this. Her bills will shoot up anyway when the deal ends, so it might as well be in her energy account in advance to offset some of that.

In answer to those who keep asking why people don't just pay for what they've used each month, it's because for many people, it is far, far easier to spread the cost over a year, rather than suddenly having to find many hundreds of pounds to pay a bill after a particularly cold winter month.

Riverwalk

I pay by DD but just £50 and then pay the extra when the monthly bill comes in, this way I get the DD discount but no extra money is sitting in their account.

I'm with Octopus and send a monthly reading.

They put the DD up to £95 and I just went into my account and reduced it back to £50. I'm not sure if other companies' web sites allow this.

The important thing about a fix rate is what they are charging you per kWh, not what they set the DD at... the DD can always be reduced according to your usage.

It's easy!

I'm with Bulb (Octopus have put in a bid) you can change your DD amount online. If you make it too low they will keep telling you. Not sure what they would do if you don't increase it at all.

Prices may/may not go up in the Autumn it will all depend on oil prices, buy in prices, economics in the world, Ukraine etc. We just need to get creative and adopt a less lazy attitude to life and stop expecting someone else to do the dirty work for us and give another handout. We are lucky in this country we can complain about heating costs, lots of countries don't have that luxury.

‘Dreading October’

I’m dreading I toner cos my fuel fuel went down from £120 per month to £119 per month…..everybody I know their bills have sometimes doubled!!!

Unfortunately no fixed tariff when you have no alternative to oil. The current cost to refill my oil tank is more than double last August's total cost. Also I have to pay 10p a litre more as the Oil Company has to use a small tanker to access my property.

if the energy company goes bust and the credit is lost

Your credit won’t be lost if the energy company goes bust, it will be transferred over to new provider, but maybe not immediately.

I pay monthly by direct debit. I read my meter once a month when prompted, (don’t have or want a smart meter), and they let me know how my account is doing. I don’t want to build up credit, just pay enough each month to cover myself. I realise it will be much higher in winter, but am allowing for that.

I’m with Shell, they are not offering any fixes at the moment, but promise to update us as soon as possible.

We are with Octopus and we pay by DD! We have built up credit and pay in the winter allowance plus the £150 we received from council tax ! We read our meters monthly, refused a smart meter , then they debit our account accordingly! Refused to increase DD payment and they were happy with this ! We feel in control !!

I like that I can vary my DD with octopus and that I can withdraw money and also have the facility to top up, it is very flexible. Lucky for me, my fixed rate finishes nov 2023. I keep a very close eye on my bills and on my account, realising, like everyone, that these few months during summer will be much cheaper than autumn/winter

So I am aiming to build up some credit by late autumn and am also doing as many one-off machine washes and tumbler finishing-off after line drying, as possible, to allow for shrinkage factor, I am talking many sewing fabrics and a few heavy cotton bedspreads. My electric usage this month will be higher while gas usage is very low. Psychologically, it will be better for me, to get this higher usage over and done with during summer, when I can line dry too

OP that dd is shocking but it is the fixed price, rather than the dd that you need to be looking at. Dds can be varied. I am sure that octopus is not the only company to allow so much customer participation in setting dd amounts

jane1956

why pay a dd when you are in credit therefor they are charging you too much? Just take readings monthly and pay what you owe

I think that the answer to your question is that the Energy Company is purporting to protect the consumer from worry and embarrassment over not having money available to pay the bill for energy to be used in the forthcoming winter.

But the consumer will have bigger worry if the Energy company goes bust and the credit is lost.

So I do as you suggest in

Just take readings monthly and pay what you owe

why pay a dd when you are in credit therefor they are charging you too much? Just take readings monthly and pay what you owe

Georgesgran

Annsixty your elderly friend might be too proud to apply, but if that’s her total income I’m sure she’d be eligible for pension credit and help with her council tax? Of course you say she supplements her income from savings - perhaps these are substantial, so she wouldn’t qualify?

I was thinking the same.

Off the top of my head, I think you can have up to £10,000 in savings without it affecting how much Pension Credit you get. If you have savings over that, the amount of Pension Credit paid starts to be reduced. I don't know what the cut-off point is, but you lose £1 per week for every £500 of savings above the £10,000.

Anyoneof state pension age with a low income should find out if they are eligible for this benefit. Even if only eligible for a tiny sum of money, it opens the door to many other forms of help, such as Warm Homes Discount on fuel bills.

I've taken the plunge and gone for a new fixed rate. Feels weird upping my direct debit now in the hope that I'll be saving come the October price increase. Our payment is still less than £200 a month but it is nearly 3 times what we were paying at the beginning of the year.
We have sacrificed one day/evening out a month to pay for it so count ourselves lucky.

I’m trying not to think what my energy costs will be next winter after my fixed rate ends in October! I reckon my direct debit will be at least double what I currently pay even though I came out of this winter in credit.

Shez1955

Have a look at this about fixing energy tariffs
www.moneysavingexpert.com/latesttip/

Thanks for that ??

The dd was the amount I quoted but the kwh was more than the 40%.

Riverwalk

kitty was the kWh rate 100% more, or the direct debit?

The important thing is to check the kWh rate, that is the actual charge, not the arbitrary DD rate they set.

I remember that some years ago there was an issue that some people, customers of one particular company, people who paid a fixed amount each month by direct debit, had the direct debit amount increased in August one year and they complained as they were significantly in credit at the time, the answer from the company was that it was to cover the costs for the next winter. I don't know whether it got resolved, or how.

Annsixty your elderly friend might be too proud to apply, but if that’s her total income I’m sure she’d be eligible for pension credit and help with her council tax? Of course you say she supplements her income from savings - perhaps these are substantial, so she wouldn’t qualify?