Increase to Direct Debit - new way of calculating Direct Debit amount?

I have already raised a complaint, and arranged to switch to another supplier

To play Devils Advocate here, and reword your question slightly:

Why should a supplier be OK with having hundreds of pounds of debit balance held by customers, with no payment of interest?

Personally I could see aiming for zero balance on 31st March making sense.
(Although I disagree with how that change was implemented).

Yes it’s a change from what we are used to, but the energy industry is changing.

However I think aiming for 1-months credit on 31st March is over the top.
(And I also disagree with how this change has been implemented).

In my view, having a months credit balance the end of  September or October to help cover higher winter usage would be justifiable, having a months credit balance at the end of March is not.

Of course September/October is not the end of the Financial year.
I strongly suspect that’s the main reason why the end of March (start of April) was chosen, for the year end accounts.

I understand the point you are making, however I am not asking OVO to allow accounts to be in debit for 12 months of the year. My own account is in credit most of the year, goes into debit around January, but this is always cleared. There is, in my opinion, an equity.

OVO ensuring everyone has a zero balance at the end of a 12 month period, even a credit balance to cover rising costs, no problem. Your suggestion of a credit balance in Autumn, given Winter bills are higher, absolutely makes sense.

My objection is to accounts being in several hundred pounds of credit year round, which is highly likely if customers have to have at least a months credit in March.

Unfortunately you keep changing the goalposts and not telling anyone.

Originally if you were on a fixed rate contract you had to be in credit by the end of your deal.

Then it was changed to be in credit by the end of March even if your deal had ended (so would be on a new fix or moved to another supplier)

Recently it seems to be changed so not only do you have to be in credit by the end of March but also have a month's worth of credit.

No attempts to make customers aware of these changes in policy.

I strongly considering moving away from Ovo when my fix ends in the autumn because of this.

That’s why I am leaving Ovo now, because of that very reason

they have tried to double mine, YES… DOUBLE my direct debits! (no prior discussion with me, to see if it was affordable)!!

can you imagine the convenience store you regularly go to,  charging you 100 quid extra next time you pop in,  and when you ask why they say its to keep you in credit for your next visit

unbelievable!

I've recent renewed my fixed price agreement with OVO with a 1 year fix  running through to 12 June 2026.  My previous agreement would have lapsed prior to 31/03/26, so I was always a bit on the fence with the fairness of the DD calculation by OVO as I figured who could really pin down where variable energy prices and the "cap" prior to this and if I wasn't fixed then 🤷‍♂️. 

Now however as an OVO customer for 5 years at the same address with a very stable electricity only demand and with a fixed price that goes beyond 31/03/26, I'm questioning the fairness of this DD policy from OVO which is still insisting I have 1 month DD credit by 31/03/26.  In the guide it says this date is chosen to take account of uncertain customer demand through the winter period, but I don't think this fair.  Is this DD pricing policy driven by the energy regulator or is it just a very blunt instrument OVO has chosen to use to reduce their less reliable customer debt.

Finally, do OVO intend to roll this date forward once the deadline has passed to 31/03/27 ?  

I think I know the answer and I just wondered with all the power of AI, I keep being told about, whether OVO could sharpen up this DD policy to give loyal, simple and reliable customers like me a break from the tyranny of  its "one size fits all" DD algorithm.

That depends a lot on what you mean by ‘fair’. It’s a mechanism designed to avoid uncomfortable shocks when moving from one tariff or supplier to another. The extra month’s credit remains yours until you decide to redeem or spend it; at most, you’ll lose potential interest earned on 1/12 of your annual costs if it were instead put in a savings account. For the typical customer spending £1720 each year on electricity and gas, that’s 60p a month that this buffer might cost. You could have saved enough to post a letter once every quarter, but you wouldn’t get enough to buy a pint of milk each month.

Ofgem and the energy suppliers are doing whatever they can to prevent further accumulation of debt by customers. At the end of 2024, the total owed amounted to £3.85 Bn. This is a long way from being covered by the credit balances belonging to Direct Debit customers, which stood at £3.28 Bn at the same juncture. 

You can see these figures and many more at Ofgem’s site.