How do Direct Debits work?

A Direct Debit is an automatic monthly payment set up with your bank or building society. It means you can choose which day you want the payment to go out each month, and your bank will sort the rest.

Once a Direct Debit is set up, you don’t need to do anything else.

It’s often the best way to make regular payments, such as your energy bill.

Why paying by Direct Debit is the best way to pay

Direct Debit is usually the best way to pay bills because:

• you get a cheaper rate if you’re on our variable Simpler Energy plan

• you don’t have to think about it – it’s all done automatically each month

• you don’t need to worry about forgetting or missing a payment

• it can help you budget as you know how much is going out of your account each month and when

• it spreads your energy costs evenly

My Direct Debit has changed recently. Will it change again because of the price cap?

Yes, it could change – but it depends. Your Direct Debit will be based on your new prices, as well as the energy your home has used over the past year. If the Direct Debit looks too high or too low, we'll let you know and it might be changed automatically. 

This is to make sure you don’t build up unexpected debt by 31 March 2026. We always want to avoid that happening to you.

How does OVO work out my monthly Direct Debit?

To work out your monthly Direct Debit amount, we:

• look at your energy use so far and estimate how much you’re likely to use by 31 March 2026. This includes any costs, such as standing charges and add-ons

• take away your current balance, factoring in any credit or debt

• divide the result by the number of payments left until 31 March 2026, which gives us your monthly amount

We aim to bring your balance to £0 by 31 March 2026. This way, you won't owe us anything, and we won't owe you anything, making it easier to manage your energy costs.

We regularly check your Direct Debit to make sure your balance is on track. 

Why is my Direct Debit increasing when my balance is in credit?

This could be down to a few reasons. Sometimes, even if your balance is in credit, your monthly payments still need to go up.

Usually, this happens if it looks like your balance is going to drop below £0 by 31 March 2026. We want you to avoid building up any unexpected debt – we never want that to happen to you. So we work out if that’s likely by predicting how much energy your home will use, then checking if your payments will cover it. 

It’s also useful for your balance to be in credit. It can act like a pot of money to cover those times when your energy use might be higher. For example, you’re likely to build up credit in the summer months when energy use is lower. But you might need to use this credit in the winter months when it’s colder and darker – and your energy use is usually much higher. 

We regularly check your Direct Debit to make sure you’re paying the right amount.

Check out our Direct Debit “check in” process here or watch the video below for more info on the direct debit review process for fixed plans:

 

You can check your current Direct Debit amount and adjust this if needed on the ‘Payments’ page of your online account or OVO app (download for Android or iOS) -

There’s also some really helpful advice here in understanding the calculation we carry out when checking your Direct Debit amount -

We’ve got lots of handy topics all about Direct Debits so check those out too:

Is there any support available if I’m struggling to pay for my energy?

There is help available if you’re struggling to pay your energy bills – both from us here at OVO Energy and from government schemes and charities as well.  There are many ways we can help – such as setting up a payment plan for you, which spreads the cost of your energy to make it more manageable. If you want to find out about payment plans, you can request one online here – we’ll take you through what you need to do, and ask you for some details. Our dedicated team is also specially trained to support you. They can make sure you’re receiving any financial assistance from the government that you’re eligible for, and take you through payment support schemes that are available. 

You can find out more about these schemes and where to seek free, independent advice right here.

Why is it that energy companies always send bills just in time for the weekend and then you can’t get through to anyone to discuss the enforced pay increase! I was waiting for over 1.5 hours and then got cut off! Weekly opening times are when we’re working as no late opening! 
You knew you would be inundated with calls from concerned bill payers and yet we’re left hanging for hours!

What if all the customers cancelled their DD and waited for you to make the contact? Is that an option as I don’t wish to be forced in increasing my payments when my circumstances have changed and there’s one to talk to!! 

Cancelling the Direct Debit will, at October 2022 prices, cost an average user over £200 on the standard credit (rather than direct debit) tariff per year.  I do not recommend you do that.  It would only make a bad situation worse.

The latest price cap announced recently, to commence in October, are for the mythical average customer, an increase of 80% on the current (already very high) rates.  Its no surprise that customers bills will increase and their direct debits as a consequence to rise dramatically.  Unfortunately saying I can’t afford will not make any difference.  If you want to challenge the DD computation you need fact and figures.

Hi @gracekennedy ,

Live Chat is open today until 1PM, which you can access via https://help.ovoenergy.com . Alternatively, try 0800 069 9831 which I think is open until 2PM today.

OVO have “suggested” I increase my direct debit amount, despite being over £900 in credit- can I just leave my amount at its current level? At least until I am at £0?

Hi @isatkinson ,

You do have this option but you’ll need to call OVO to request a three month Direct Debit freeze. The Collections Team can arrange this for you, if you call 0800 069 9831 they can discuss whether this is the right move.

Hi @isatkinson,

Welcome to the OVO online community.

I can see you’ve already met @Blastoise186 one of our volunteers. Great to see our community members giving you some tip-top advice. 

Just wanted to step in here and add; if OVO are suggesting you increase your direct debit it sounds like you may have recently fixed into a new plan on the higher rates or are on the Simpler Variable Plan with prices set to go up in October. 

Here are some resources you may find helpful:

The direct debit review takes into account any credit balances you have on your account. If you are on a fixed rate contract it is worked out to ensure when your plan comes to an end there is a £0 balance on your account. 

If you are on the Simpler Variable Plan it is worked out over an annual period to ensure there are no large spikes in your bill over the winter period. 

We know that direct debits aren’t for everyone and if you would prefer to pay on receipt of your bill you can opt to go onto the Simpler Variable Plan on demand plan. It is more expensive than the Simpler Plan paid by direct debit. 

It is worth mentioning you can request a refund up to £500 at any time through your online account as long as the following are met:

• Have been billed within the last 28 days to an actual reading

• Have an active Direct Debit with at least one payment received from that bank account

• Request a refund of over £5

• Request a refund up to £500

• Leave a remaining balance of at least one month's Direct Debit

Refunds can be requested through your online account by following these steps:

• Go to the Payments tab and click 'Apply for a refund'

• Choose the amount you wish to have refunded

Keep us posted with how you get on! 

I live in a one bedroom flat where I don’t pay for heating / hot water etc I pay a separate service charge for this… I have an OVO smart meter and my direct debits are increasing every month started £21 / £25 / £27 / £30 it’s now £34 but I received an email from OVO wanting to put it to £50 a month (even though I’m £104 in credit) and this is before the next rise in October… I hardly use any electric I don’t have a washing machine, I hardly watch TV, I wheel round in the dark (manual wheelchair user) why is it so high???

apparently after looking into it my standing charge atm is 41.32p a day / price per kw is 27.10p a day

im scared I can’t afford another rise especially when I’m not using anything, no tv, or lights - obviously I use air fryer to cook but at this rate won’t be able to afford that either :( 

do these figures seem right?? I don’t have anyone really to compare too…

Hi @hayoborn 

Thanks for all the useful information. The users of this forum should collectively be able to advise what your costs should be.

What would be useful, if you know it, is your annual usage in kWh. And if you have it, the split month by month over the last 12 months. I'm guessing your usage doesn't vary as much as others if heating isnt included in your bill. This information should help advising what your DD should be set at moving forward.

Last years KWh usuage was about 850-900… when I asked the advisor today she said over 12 months I’m likely to use 1,143 kWh this year (rolling 12 months)

@hayoborn

There is a lot of advice we can give, so lets start by getting a better idea of your usage. There is lots of government help with costs, but lets look at your basic usage and costs first. OK? 

If you log onto the website, not the app and look at this page, you will see something called Future Annual Consumption. This is what OVO use to calculate your direct debit. It updates gradually over time as you change the amount of electricity you use. 

https://account.ovoenergy.com/plan

Here is mine for example

What do you see for Future Annual Consumption? Something like 1143 which was the figure OVO told you?

Also on this page you will see the unit rate and standing charge figures. These are excluding VAT. So you would need to add 5% to these to get the total cost. These are the rates up till end September. They haven't updated the rates on this page for the 1st October prices if you are on the Simpler Energy plan. What do you see on this page for the unit rate and standing charge?

Also on this page you can see the name of your plan, does it say Simpler Energy like mine? 

Last years KWh usuage was about 850-900… when I asked the advisor today she said over 12 months I’m likely to use 1,143 kWh this year (rolling 12 months)

@hayoborn

There is a lot of advice we can give, so lets start by getting a better idea of your usage. There is lots of government help with costs, but lets look at your basic usage and costs first. OK? 

If you log onto the website, not the app and look at this page, you will see something called Future Annual Consumption. This is what OVO use to calculate your direct debit. It updates gradually over time as you change the amount of electricity you use. 

https://account.ovoenergy.com/plan

 

 

@Jeffus 

Here is mine: 

@hayoborn

OK. So prior to the 1st October changes you would be paying something like

365 x 0.4132 x 1.05 (VAT) = £158.36 in Standing charges

1142 x 0.271 x 1.05 (VAT) = £342.96 in usage costs.

So something like £501.32 a year or £41.78

Assuming you have something like £104 in credit, you would have needed to pay over the next year something like

£501.32 - £104 = £397.32

So about £33.11 a month, which is in line with the £34 pound OVO were asking for. Does that make sense? 

As you have probably heard, energy is unfortunately going up in October. It was going up a lot... but the government have capped the unit rate, but not the standing charge. So you will need to up your direct debit. OVO are in the process of updating everyone's direct debit, but it is difficult to be certain exactly what figure everyone has been given at the moment. When i asked yesterday OVO said the new unit rates and standing charges would be available today. 

We can work out a very good estimate for you in the meantime if you like? 

The money saving expert website has a great calculator. 

https://www.moneysavingexpert.com/utilities/what-are-the-price-cap-unit-rates-/#tool

You simply enter your usage, 1142, and select the region you live in. It is great as it uses the regional price cap rates and the government Energy Price Guarantee. The price of electricity varies depending on which part of the country you live in. It is unlikely OVO will charge much less than the regional price cap with the Energy Price Guarantee. 

What figures do you get from the calculator? 

There is some good news we can talk about after that. 

@Jeffus 

here that comparison is: also I went back over my usuage this year and in March my usuage was going over £1 a day where as before March wouldn’t be anywhere near that… I don’t understand why it’s so high when I don’t pay for heating / hotwater - all my lights are eco friend bulbs - I hardly watch tv… at the moment I’m scared to do anything…

@Jeffus

here that comparison is: also I went back over my usuage this year and in March my usuage was going over £1 a day where as before March wouldn’t be anywhere near that… I don’t understand why it’s so high when I don’t pay for heating / hotwater - all my lights are eco friend bulbs - I hardly watch tv… at the moment I’m scared to do anything…

 

 

Hi @hayoborn OK.

So lets see if we can answer that question. Electricity unfortunately been going up for a long time now. Your bills and direct debits would have gone up at the same time. 

The price you pay for your electricity would have gone up in October 2021, then April 2022 and now in October 2022. Your direct debit will have gradually increased over that time as you have seen. Winter months you will see the biggest increase in cost. 

I know it is not great, but I hope that makes sense? I could do some calculations about each of the increases in October as 2021, April 2022 and October 2002 but i am not sure it will help you. Basically there has been a dramatic increase gradually over the last year as you have seen. Also standing charges have gone up a lot, particularly for electricity unfortunately to cover things like failed suppliers. 

So lets look at the figures on the Money Saving Expert Website. 

They won't be exact, and it may be your home is in a slightly different region to the one you think it is (some of the borders  used may not be obvious). 

Anyway, the current year cost they estimate is £480, so pretty close to the £501 we worked out. We could try and get more accurate figures, but it is probably not worth it at the moment given OVO will update us all. 

The next 12 months money saving expert estimate £550, so lets say that is actually £580 over a year for now given their figure for this year looks a bit low. So that would be £48.33 a month. 

£580 / 12 = £48.33

But you have about £104 in credit. 

£580 - £104 = £476

£476 / 12 = £39.67

So about  £39.67 a month. 

The good news is the government are giving you £400. OVO will put this in your bank account over the next 6 months. 

So over the next year you are paying only  around

£476 - £400 = £76 

for your electricity in total for the whole year. So dramatically less than this year. 

OVO will put the following in your bank account

October £66

November £66

December £67

January £67

February £67

March £67

A few days after you have paid your direct debit, OVO will put the money in your bank account. 

You may also get other support, for example if you get Personal Independence Payments or something similar you will get £150 from the government paid into your bank account in September. 

I hope that helps. Probably best to see what OVO tell us all today and over the next few days to get more accurate figures. 

We should be able to see our new unit rates and standing charges after the 1st October at the very latest on the plan page

https://account.ovoenergy.com/plan

So you have been an OVO customer since 2018? Do you get the Interest Reward on your credit balance? 

Hey @hayoborn,

Welcome to the OVO Online Community. 

It’s great to see our community members giving you some really helpful advice here!

It’s a difficult time, and energy prices have increased significantly. Which means the majority of customers will see a large increase in their monthly costs.

We have plenty of advice and support available. Check out this great guide about the price increases and how OVO can help their customers here:

The government have recently announced the Energy Price Guarantee to cap average household energy bills at £2500 a year from October. The support will be available for two years and is in addition to the £400 rebate.

We’re currently working through what these announcements mean for us, and our customers. We’ll be in touch with all of our customers to let them know what will be happening to their energy bills.

For now, the advice is; If  you’ve received any Direct Debit review letters or a Price Increase Notification letter, you should ignore it and wait for a new one to be issued. 

Hope this helps. 

@Jeffus

here that comparison is: also I went back over my usuage this year and in March my usuage was going over £1 a day where as before March wouldn’t be anywhere near that… I don’t understand why it’s so high when I don’t pay for heating / hotwater - all my lights are eco friend bulbs - I hardly watch tv… at the moment I’m scared to do anything…

 

 

 

So you have been an OVO customer since 2018? Do you get the Interest Reward on your credit balance? 

@Jeffus 

I’ve been with OVO since 2021 I believe it was SSE before that… what is the interest reward? I really appreciate your help so the £400 from OVO will go into bank account rather than on my balance with OVO

Yes, the £400 goes into your bank account for Direct Debit customers. OVO have decided to do that rather than put it on your OVO balance. Useful to know as soon as you pay what might seem a large direct debit, a few days later you will get some money back. So perhaps save a lot of that money up as the payments are only for 6 months. I'd also personally recommend keeping a reasonable credit balance on your OVO account so you don't have to worry too much about any future increases. Remember we did the calculations based on using up your current credit balance over the next 12 months. 

Ah OK, i assume you were one of the SSE customers automatically transferred to OVO, you don't get the interest reward. The scheme was withdrawn last year for all new customers including those from SSE.

There is additional automatic help if you are a pensioner or some people on  means tested benefit. These will automatically be paid into your bank account by the government if they apply.

We can always check the figures again once OVO have emailed us all about our new unit rates, standing charges and direct debits if it helps.

The good thing is that the unit rates and standing charges are guaranteed not to increase until  Oct 2023 in two years time so this should help with budgeting. There is no guarantee unfortunately that the Government will give everyone another £400 next winter. 

@Jeffus 

my neighbour has the exact same setup as me one bedroom flat and doesn’t pay for heating / hot water and she HAS a washing machine and watches TV constantly…

she is on the same tariff as me but only uses 758kwh a year…

I don’t understand why mine is so high in comparison 

Hi @hayoborn 

It can be hard to find out why some people use more electricity. For example it could be your fridge is less energy efficient. So i would be wary of trying to compare. 

The Future Annual Consumption figure was set a bit high initially for some ex SSE customers.

You might find this gradually comes down as the system realises how much electricity you use over a full year. Take a look at the figure once a month, it gradually updates. 

https://account.ovoenergy.com/plan

You only pay for energy you use so it is not an issue, it just means you might build up a bit more credit. You might actually find you use close to your neighbours. 

Ofgem quote the typical domestic electricity use for a one bed flat as 1800kWh a year. So your usage is very low, not surprising given what you have said. 

Take a look at this page, do you see a smart meter reading every day? 

https://account.ovoenergy.com/meter-readings/history/electricity

Do you know what date you transferred to OVO? Have you been with OVO over a year yet? 

@Jeffus 

10th Aug 2021 my smart meter reading was: 05042

10th Aug 2022 my smart meter reading was 05981

Difference total = 938

I suspect you will find the Future Annual Consumption estimate gradually gets closer to that, if your consumptions remains stable. They are pretty close based on experience so  nothing to worry about. 

They are never exactly the same for anyone. Mine for example is 2433 vs 2390 but i have been an OVO customer for longer. 

I suspect your consumption will never get as low as your neighbour says theirs is. 

Hey @hayoborn,

Great to see our community members giving you some tip-top advice here. 

Even if your estimated annual consumption was higher than your actual usage, as you’re on a smart meter your account balance will be accurate.

If you aren’t currently on half hourly readings, I'd advise getting this updated so you can make the most of our OVO greenlight tool and live billing system. For more information we have a great guide here:

If you think your usage is too high, it may be that you have an appliance in the property that is using more energy than it should, or that your meter is clocking to much consumption. We have a guide about this topic you might find useful:

Hope this helps.

@Jeffus 

i received an email this morning with the new prices per kWh and standing charge etc, how can I roughly work out how much I will be charged now… 

sorry to sound dumb I don’t really understand it, but the way you word things etc has been very helpful :)

Multiply the standing charge by 365 days.  Multiply the unit charge by your forecast consumption.  Add those two figures together to get you forecast annual bill.

If you pay by fixed monthly Direct Debit, add to that total your current account balance if it's a debit, or subtract it if it's a credit.  Divide the new grand total by 12 and that is an approximation of your likely direct debit amount.