We renewed our OVO energy contract just 2 months ago to the 2 yr fixed price plan. Having been customers of OVO for several years they had lots of info on our energy consumption. The offer of a two year fix at £118 per month seemed too good to be true since we had been paying £140 per month. I queried the amount several times when we signed up but was assured that £118 would cover our costs. Today, just two months into our contract we have been advised to increase our monthly payment to £128. Whilst we have probably used more gas in the last 2 months than last year due to the cold winter, it seems incredibly quick to make us start to pay more. A good summer could soon reduce our gas bills! I fear it's as we thought - a low offer to tempt us to renew our contract and then bump up our monthly payment.
Has this happened to anyone else? And how did you deal with it? Sit it out hoping your consumption would even out over the year, or increase your payments?
Updated on 04/11/24 by Abby_OVO
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:
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you get a cheaper rate if you’re on our variable Simpler Energy plan
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you don’t have to think about it – it’s all done automatically each month
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you don’t need to worry about forgetting or missing a payment
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it can help you budget as you know how much is going out of your account each month and when
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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:
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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
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take away your current balance, factoring in any credit or debt
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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 the video below for a quick run-though of this process:
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.
What can I do to help manage my energy?
As your recommended Direct Debit amount will be based on your energy usage, here’s some information that might help, when it comes to managing your energy account. It’s easiest to manage all this through your online account. If you don’t have one you can set one up here.
- Sending regular meter readings. Without meter readings, we have to estimate your bills and this can mean they aren’t 100% accurate. You could be paying too much or too little for your energy. To stay up to date, submit your readings here if you’ve got a traditional meter.
- Getting a smart meter. Smart meters send readings for you, which means we know exactly how much energy you’re using – so your energy account is always up to date. They can also help you track your energy use in real-time. You can book your free appointment to get one installed here.
- The Centre for Sustainable Energy can give you free, impartial advice on saving energy. Just visit cse.org.uk/ovoboost
I find it odd that with all the historical usage data Ovo has for me, the estimated monthly cost figure is not personalised to me. I don't find their method of calculating my estimated usage costs very helpful, but I guess the methodology is set by Ofgem perhaps? If they have my data, I don't see why they couldn't also show me a figure alongside the estimated one, based on my actual previous year's usage - this would be very helpful to me.
We are just finishing on a two year fixed tariff for electricity only at £78 a month (we are in a flat). I looked at the tariffs just a week ago and was quoted £90. I have now been quoted £117. Thats a 50% increase on my current tarif!
How can that be justified given that I am still in credit.
I let my fix run the 2 years at the original direct debit amount and ended up around £400 in credit. Now have a quote for a new two year fix just £1 per month higher. Seems reasonable but gas prices have reduced substantially and my quote has only a small reduction in the gas element. Based on my credit I would have expected a lower direct debit prediction. When I did a comparison with other energy companies I found quite large savings could be made. A large part of the saving being due to significantly lower standing charges for both gas and electric. Have others done comparisons with same outcome? We are mulling over whether to make a switch.
Hey
Your renewal quote is based on your estimated annual consumption figures and the new rates available.
There has been a price increase compared to the rates you were fixed into. When a fixed plan ends you are given the new rates available in line with the market price.
The amount of credit on your account has no impact on the unit rates we offer for a renewal to our customers, you’re free to request a refund for your excess credit, that being said if you have enough excess credit you could use that to make up the extra recommended in the new quote.
Hope this helps!
Doesn’t really explain either the reduction in gas price or why standing charges are high compared to other companies quotes on a comparison website. Makes me wonder whether OVO quotes a lower standing charge if you want to switch from another company to them?
We price inline with the market,
Our standing charges are a true reflection of the industry costs incurred to transport and maintain the gas and electricity supply which goes to our customers homes. Other suppliers may integrate a large amount of these costs into unit rates instead of having a separate standing charge, or run at a loss-leading rate subsidised by the higher non-contract rates paid by more long standing customers - often those who are less likely to switch. We review our prices on a regular basis and have been just as quick to drop our prices in the past when we have seen decreases in commodity cost.
We don’t offer different rates based on tenure.
Thanks!
Hi
Well, you can guess which one I opted for!
I’m actually looking forward to the day when OVO’ eventually offer a half-hour variable tariff. One of the current problems with such a tariff is that the Network-Charge for electricity stays static regardless of the time of day or what extent of the grid my electricity has used.
As I live in an area with a surplus of renewable energy, I don’t think I should be paying a levy to National Grid for electricity which has never passed across their cables!
There are quite technical reasons why this is difficult to change, but it is a subject which I discussed with my MP in December. So if the Energy Industry doesn’t start making progress to resolve the issue, then I think they’ll find Parliament putting them under pressure!
I recently changed my tariff to a new 2 year fixed tariff in mid-August, at which point it said “by the way, your direct debit needs to be increased, here’s your recommended amount”. I’ve checked over the electric projection, compared it to last year’s consumption and calculated it using the new tariff figures (the joys of Excel) and I don’t have a problem with that. Prices go up, you need to pay more, deal with it muchacho.
The gas projection though seems to include an estimated figure for when my supplies were migrated over from SSE. I did think it was odd at the time that my old tariff and recommended DD amount was £5 per month (oh, how I wish!) but is it possible that the projection calculator’s being affected by this and giving a false recommendation?
Hi
I don't work for OVO i am just a customer like you. Some of us post from time to time if we think we can help.
The direct debit debit calculator on this page
https://account.ovoenergy.com/payments/direct-debit/calculator
uses the Future Annual Consumption Figures on this page on the website not the app.
https://account.ovoenergy.com/plan
For some ex SSE customers the Future Annual Consumption figures were not pre populated with particularly accurate figures. The system will auto adjust over time, but it will take some time. You are lucky if your Future Annual Consumption Figures are too low, it is more of an issue if they are too high.
The Direct Debit calculator takes into account any credit balance you have, but doesn't take into account the government £400 grant as OVO will pay that directly to your bank account over 6 months.
So yes, if the Future Annual Consumption figure looks too low then manually adjust your Direct Debit to something reasonable for now.
Does that make sense and help?
Okay. So I’m currently waiting on hold - after being lied to by the smarmy IVR man that I’d be on hold for “less than five minutes” (twenty minutes, mate, twenty minutes and counting) - and I know OVO have royally screwed this up.
My projection figures are based on estimates. How do I know this? Because the figure they’ve used is something more akin to the national average and unfortunately for OVO I know how to work out precisely how much I’ve used over a year and calculate the gas kWh and the projection figures (helps if you worked for SSE, btw). My future usage should not be as high as OVO thinks it will be.
Now just to get to someone first thing on a Saturday morning and deal with the awful IVR music...
Why is OVO increasing my direct debit saying my charges will be going up even though I’m on a fixed rate.
When is a fixed rate just a variable rate under another name when you join OVO
Without the context we cannot answer you. We’re mainly just other interested members of the public but strangely enough we can’t read minds, so don’t know the background to your question.
is it possible your fixed rate is ending and so you’ll move onto another tariff at higher prices, or have you used more energy than previously forecast?
A fixed rate fixes the prices but it doesn’t cap your energy use in any way - you still have to pay proportionately to your consumption.
I just took out my fixed rate 1 month ago. Sent 1 lot of meter reading how can they tell anything from that. Just want to put direct debt up to make more money.
Fixed rate deals look forward across likely future energy prices, and will be set at prices unimaginable 18 months ago. Tomorrow (8 Sep 22) the government will announce its plan for solving the energy price crisis, and it's almost certain that it will be beneficial for most people on fixed price deals to abandon them and go back to variable prices.
OVO will be using your historical consumption data as a basis for the future - but as I said above its likely that you might need to revert to the variable tariff.
They have done it to me too jumped me from £70 a month to £261. Even with my consistent usage amounts they just want to hold on to are money for a few months then we are allowed to ask for it back apparently with a refund request how ever long that takes......
A fixed direct debit averages your bills over an extended period -say 12 months. If you period starts in the summer when your bills are low, then you will build up a credit. that credit will then gradually disappear in the winter months when your bills are much higher.
So the best time to start a DD is in December - then your account will be in debit for most of the 12 months. But its not a scam to rob you of your money.
Hey
I’m sorry for the issues you’ve been having.
A fixed rate plan means the unit rates (the price per kWh of energy you use) and the daily standing charge you pay are fixed for the length of the contract.
If you were a new customer of OVO when you sign up you will be asked for your estimated annual consumption figures in kWhs for gas and electricity. If you didn’t give these, your quote would have been based on less specific information such as the type of property, how many people live there and whether energy is used all day or evenings and weekends.
The direct debit isn’t fixed, it is regularly reviewed and as it is based on usage, if your usage is higher we’ll get in touch to let you know to increase it.
Here is a helpful guide which explains more about the direct debit review process:
There is a really great tool on your online account which will show you exactly how your direct debit has been calculated. We’ve built a tutorial on how to make the most of this tool.
Energy prices are rising at the moment and we have lots of support available for our customers.
I hope this helps.
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