Paying for energy by Direct Debit? Your bill may rise before October so be ready!

Toothless energy “regulator” Ofgem has said household bills may rise before the price cap does in October, as firms try to spread the cost of higher use in the winter months.

The story is on the BBC here.

But this kind of unilateral change by energy suppliers means customers are denied the opportunity to change the way they pay, if they have to.

Who says people are going to want to spread a notional cost of energy they haven’t used?

Millions of us are planning to limit our energy use instead, cutting out all but the essentials – so for us it would be better to take back what we have overpaid in the summer and pay only for what we use in the winter.

The suppliers won’t be happy with that because it removes their safety cushion. But they have been merrily paying massive bonuses to their shareholders, so perhaps they should have engaged in a little forward thinking before demanding that the rest of us take the strain?

As This Writer stated in a previous article, the best advice for you – for now – is to get in touch with your supplier, explain your personal financial circumstances and discuss the best way for both of you to get through the current crisis.

It will also give you a chance to check how quickly your supplier will bring bills down when energy costs start to drop again.

1 thought on “Paying for energy by Direct Debit? Your bill may rise before October so be ready!

  1. 6033624

    I worked for an energy supplier years ago and specifically dealt with people who hadn’t/were unable to pay. There’s no requirement to have or stay with DD. You can move to 2 monthly after being invoiced, you can pay monthly cash or weekly with a card. None of this is publicised. They want you to think your options are DD or prepayment. You can read your meter and phone it in every month/week or whatever and when you pay the bill just pay what’s due. Disadadvantages are that you’ll not build up credit for an expensive winter but it’s your choice.

    If you fail to pay AND you are registered as SNEEDS (special needs means anyone with ANY health condition that could affect them if they are cut off or affect their ability to pay via prepayment) you can’t be forced to get a prepayment meter. Of course prepayments are the horror that they are made out to be. They cost only a little extra than paying monthly cash. And you can still use it to budget for the winter by simply topping up more than you use but with the advantage over DD that if you can’t afford it this week you don’t need to pay. Remember ONE missed DD at the bank will wipe out any saving you make by paying this way – do what suits YOU. In theory if you build up debt and don’t have an arrangement in place to pay it then they can take legal action against you. Small Claims is most likely in Scotland and England. This could force you to pay a fixed amount. Of course they need to prove they’ve tried to recover it so if you get in this position speak to them and tell them you can’t pay. They SHOULD do an income and expenditure form with you. If you agree to pay approx 25% of your free pay and continue paying your bills then that should be accepted. If not then you can ask the court to set it at that amount and they’ll be forced to accept it. Bes to agree it with energy co though, you can revisit it as prices rise.

    But, if you are on benefits, it’s different again. You have another option. Despite what DWP will try and tell you you CAN have it deducted from benefits direct. Make sure to tell them that you are ‘unable to budget your money’ and have ‘built up a considerable debt you wish to pay’ Even IF they agree it will take many months for them to organise this after the many months you wait for them to agree to this. However you MUST tell the energy company that you have done this and they SHOULD wait before taking action. If you are SNEEDS they won’t be getting a warrant for a meter anyway. NB you don’t need a doctor’s cert for SNEEDS and the other advantages are getting advanced notice of outages etc. The DWP has already stated it will NOT raise the maximum amount paid from benefits to energy companies so your deduction will remain fixed and you will continue to get gas and electric.

    Whatever happens your energy will NOT be disconnected. They used to try and disconnect gas if you had electric cooking stating that you can use electric heating. But as they won’t be in your kitchen they have no basis for such a statement but AFAIK that dodgy practise has ended. Be aware though, commercial premises CAN and ARE disconnected. So if it’s your business and not where you live then you WILL have no energy til you pay – although you CAN get prepayment for commercial too.

    For some debts it really IS better to ignore it but NOT in this case. Register as SNEEDS (whether on benefits or not) Get rid of your DD and read it every month. IF you can afford to pay extra in the summer then do so but if not then don’t.

    And whatever you do don’t fall prey to some unscrupulous scrote who tells you they know ‘how to rig a meter’ There are two ways to rig an electric meter, bridging and bypassing. Bridging CAN’T be done safely yet is the most common way – your entire load for the house going across something as thin as ‘speaker-wire’ is a sure way to have an electrical fire and by-passing is safer (if using the existing wiring) but is VERY obvious when the meter reader calls round – you’ll get caught and they’ll send someone round when you stop paying electric but still have a small gas bill* So still not a good idea.

    The reason for that is that rigging a gas meter is less commonplace so those with gas heating tend to bypass their electric, use oil filled radiators and obviously the bill for gas drops and the electric bill goes to zero – they have teams working for them looking for this kind of activity. If caught they’d warn you, fit special seals on your electric meter (gold seals) and keep an even closer eye on your bills. NB your meter has seals fitted to it anyway so it’s apparent if it’s been tampered with. Being fair though when a meter change is carried out the fitter will only pay attention if there is a bypass or bridge in place – same for meter readers (although you can’t depend on it)

    Obviously you want to cut your bills but buy enough food and have enough heat before doing ANYTHING. After that you can decide which of your bills are most important by prioritising them NOW and deciding which to pay in full and which you will try to postpone etc. If unsure see CAB now before it’s an issue.

    Hope this helps someone, spent years in this industry and there is ALWAYS a way to resolve things. Never seen bills this high though and although they have their jobs to do they are facing EXACTLY the same problem you are – you don’t get staff discounts.

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