It’s around £200 a year extra to pay that way. Tbh if you’re going to do it, paying by debit/credit card, Google Pay or Apple Pay will be way faster than BACS, shows up immediately and reduces the admin load on OVO’s teams.

Thank you for the info. I’m assuming the additional charge is due to increased administration costs? If this is the case, the inconvenience of BACS payment would be covered.

Paying on-demand carries more costs for OVO and also more risk of non-payment.

I just cancelled mine as they keep putting the direct debit up and up despite being in credit and my usuage being way lower. Yes I understand its calculated by the 12 month estimate but I wanted to pay on receipt of bills via direct debit but apparently this is not possible (not sure why) so I've set up a BACS and I'll just top up when needed via a card. I've uploaded my new rate about £150-200 more a year ( south west).

I much rather have more control and have the money sat in my bank rather then theirs.

I was looking to do exactly the same thing - I’m £450 in credit yet online saying I can only have a max of £71 refund …. Of my own money !!! Makes me a little cross to be honest along with the fact that for some reason it’s cost 6p per day more in standing charges and unit cost more expensive when you just want to pay for what you actually use!!! It’s really not right , don’t know any other service area or products where you have to pay for what you MIGHT use in the next 12 months. 

I see in another thread @Sunshine42 that you’re planning to change to paying on receipt of your bill, and at the higher rate. But before you go can I just say that Ovo’s live billing platform uses your meter readings through the year to adjust the amount you pay over the 12 months, so as time goes by if you reduce your usage you’ll also be able to reduce your direct debit. It’s calculated on your estimated Future Annual Consumption which you can see on the website (not the app) under Plan Details.

Hey, to be honest I’m a single mum- I work full time - I have reduced my usage by loads  over the past couple of months and seriously would not be able to cut back anymore apart from permanently sitting in the dark ( although I have been using a lot of candles more recently lol) and cooking on a bonfire. 

Hi

Give Collections a call. Have a chat with them about a payment plan that might work for you

0800 0699 831

I’m ok at the moment , not struggling to pay because I’m being so careful and have reduced it - I’m just annoyed at being in so much credit and not being allowed it back -  it’s my son’s bday at the end of this month and Christmas of course so having over £400 sitting in OVOs bank instead of mine and not being able to get it back quickly and easily, in my opinion, is not acceptable 

What I meant was that the system won’t ask for the same direct debit amount if your usage drops. Sounds like it might very well be less than anticipated.

The direct debit is just a way of levelling out the payments over the year so the winter ones aren’t gigantic compared to the summer ones. At this time of year a credit will build up, then be used during January/February. Also it’s a cheaper method for the company to process the payments, hence the lower rate.

Cheaper method to process the payments…. What exactly are the additional costs to OVO if I go online every month and pay online? Is it really £20 a month more???? Think not ….. but they gotta make their profits !?!? 
 

I also know this is all energy company policy  and not just OVO 

I can’t face searching through the forum for a full explanation of why it’s cheaper but someone has written it all out beautifully.

For the  price cap it is actually ofgem that set the upper cap prices for the different payment methods.

They work out what the extra costs are. 

Unfortunately it does cost more to service people who pay on receipt of bill. A significant number of people in this category need chasing multiple times. It is a shame that impacts others but that is the reality. A lot of people don't go online and pay in time. 

The price cap rates for pre payment meters are particularly hard given these are often the poorest people. Some suppliers including OVO have campaigned for changes for pre payment meters.

Ive always paid by direct debit but last year bought my dads home after he passed away. Sold my home and took over dads account. Its only a bungalow and just me so I took over the account and said I would pay as he did (on demand)

For me this is brilliant. I can see how much I use and have the money saved in my savings account and pay as soon as monthly bill is ready. I pay approx £60 a month electric and yet when I enquired about DD Ovo wanted £280 a month

I understand dd unit price is lower but realistically I want the money in my bank account and for me its certainly so much easier

Well I have cancelled my direct debit with my bank  and will try to contact them again to let them know,,,, I’m assuming though that my tariff won’t be changed to the higher non DD rate until my account is at £0 , as that £449 was collected via DD? 

Incorrect. Your tariff will be changed immediately to Simpler Energy On-Demand and be immediately more expensive than it was before. You don’t get to keep the cheaper rates if you cancel the DD, regardless of how much credit is still in your account.

If you want to keep the cheaper rates, you must re-instate the DD.

I’ve been browsing through the previous threads and it is obvious that people are getting really irate with power companies in general.  My OVO account informs me that I am using 14% less electricity and 28% less gas than I did last year.  I am currently £731 pounds in credit whilst paying £130 per month and my £66 from HM Gov’t goes straight back into the account.

The last 3 month bills have been (on average) £85, with this month currently about £115 due to CH usage. Taking all that into account my latest warning from OVO says that I need to increase my monthly DD to £135 per month.  That is the last straw.

I know it’s biting off my own nose etc….., but I’m going to monthly bills as I’d rather have control of my money.

Also, having one of the ‘helpers’ on this forum say that the costs go up for monthly billing is because people don’t pay their bills and have to be chased………..Speechless

It is true that paying On-Demand carries increased risk of non-payment though and those costs have to be recovered somehow.

The increased tariff rates also factor in the extra admin time and costs involved with supporting that type of payment method. It’s harder to fully automate On-Demand billing than it is for Direct Debit billing. One can be fully automated all the way through, the other often requires human involvement.

Hey @jimgamgee1ring,

You can request a refund at any time of your surplus credit by contacting Support, you’ll need to keep one months direct debit on your account as you pay monthly, in advance.

You can find out how your direct debit is calculated by using the direct debit calculator tool on the Online Account:

If you feel the estimate for your direct debit is too high, our Collections Team can put a hold on your account for three months, meaning your direct debit will not be reviewed for this period.

Do you submit regular readings? Or have a smart meter? If not, I'd advise getting one installed. If we don’t get regular readings, that means your estimated annual consumption (Which your direct debit is based of) will be estimated. 

OFGEM regulates suppliers and the reason the prices are higher for manual payers, is because they recognize that it costs more for energy companies when customers pay this way (due to communications having to be sent to chase payment, and also non-payment and bad debt). 

Hope this helps. 

This really is so much smoke and mirrors. I, and I daresay millions of other consumers have paid their quarterly bills without fail by direct debit for a decade or more.  It was a standing order before that, forgotten how that worked.  You received a bill and paid what you owed.  I simply fail to believe the rubbish that we honest consumers should be penalised and lumped in with small minority of delinquent customers.  OVO can institute a late payment fine system.  We regular customers should be entitled to pay on demand by DD  without premium cost.  I simply dont believe we present a cost premium of £200/pa. Its all done by computer so your get up to date readings and can calculate a monthly bill - no admin overhead.  Never mind you trying to take care of customers accounts (and swell your cash flow).  We want to look after ourselves like we used to do without problem  Tell the truth or lets get Ofgem onto the case

Couldn’t agree more with this comment.  However, Ofgem appears to be hand in glove with the energy companies - so I wouldn’t expect any action from them to redress the balance.  After all, one of the non-exec members (Christine Farnish) recently resigned as she felt the regulator had not ‘struck the right balance between the interests of consumers and the interest of suppliers’ on how the price cap was addressed.

This is a business decision for suppliers to make. There’s nothing in the rules that says OVO has to offer variable Direct Debits at all. As long as the available payment methods include the ones that are required, it’s down to each supplier to decide whether they want to offer even more options on top. For example, Google Pay and Apple Pay support is optional, but OVO now offers those to make things easier for us.

I don’t know if this is going to help concerned customers reading this, or whether it’s going to cause more confusion. Still, here goes, with a view to clearing up some of the misunderstandings and unconfirmed postulations in this thread. 

I checked the data underlying the pages at OVO Energy  to see whether I could find a listing of current tariffs. This is what I found:
  

 
These rates (all exVAT) will be different for users in other regions and for users with a different usage pattern, although the only specification I could find was that my usage was deemed ‘low’. However, unless there is a mistake somewhere, it looks like the cheapest option for an E7 user like me with electric night-storage heating would be PAYG, considering the night rate shown here. The difference between Direct Debit and On demand tariffs is manifest.

Out with the calculator! 

Well, that’s quite a big jump! I didn’t think it’d be that big though.

I could have included calculations for some of the differences, like:

• The OD standing charge is 13% higher than that for DD. The difference is £20 a year + VAT.
• The single-rate charge per kWh for OD exceeds that for DD by 11%. For the average household consuming 2400kWh/year, this is a difference of £80 a year + VAT.
• It would cost the average household £106 more per year to switch from DD to OD, i.e. about £2 a week.

I don’t have gas, so someone else will have to work that out. It could be that the gaseous differences would bring the total excess of OD over DD to £200 a year.