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Just moved house - Can I cancel my switch back to OVO and stay on a variable plan with the existing supplier?

H

I think I may have done something a bit silly. Me and my partner are renting a new flat and got a letter through the post from Octopus (who I assume were the previous tenant's electric company) titled 'To the new occupier.' I clicked on the link and put in the code on the letter and it came up with a price of £268 per month as the cheapest price, on a fixed price contract. 

Thinking that was too much, I looked at OVO's prices and found one for £153 per month as a fixed price contract so signed up to that instead. However, the cost per unit of electricity is higher than the price cap, although the standing charge is the same. From my understanding, instead of signing up with the fixed price Octopus tariff, I should have just let them keep sending letters through the post, which would have been calculated at the price cap. The letter from Octopus wasn't very clear and made it seem like you had to sign up to a fixed price tariff but I likely should have researched it more.

We're still well within the 14 day cooling off period for OVO so I would like to cancel and revert back to the price cap with Octopus, but I'm not sure this is possible.

Can anyone advise please? If I cancel with OVO will it just go back to the Octopus price cap cost with them sending a bill each month, instead of signing up to the fixed price contract? I believe the switchover date is May 19th. Thanks in advance, I know I've been silly here.

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Best answer by Jess_OVO 4 May 2022, 14:05

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Blastoise186
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Hey @Howkflakegirl !

Good question. :)

As this is a supplier switch from Octopus → OVO, cancelling now will result in your supply going back to Octopus on their default tariff. It’s worth noting that fixed rate deals are not price capped at all, only variable rate tariffs are. What OVO is doing here is fully permitted by the rules.

Personally, I’d probably keep the OVO deal now that you’ve got it locked in. You’re guaranteed those rates for the entire term no matter what happens on the market. If you go back to variable rate, you’ll have no protection at all from price rises - and there will be another hike in October this year. It’s possible that it could even be a whopper hike to the price cap that may (or may not) wipe out any potential savings from using a variable tariff now so it’s a huge gamble. The deal you just secured is unlikely to come up again, especially if you wait until later in the year, so it may be worth taking the hit now from the higher cost, but raking in the savings come the winter when you’re still enjoying the same rates.

At very least, OVO only charges a £30 exit fee per fuel, so you could always switch to OVO’s Simpler Energy tariff later if the potential savings from that would make up for the exit fee. Or if not, simply keep the fixed deal.

If you really want to switch back, you can still do that by talking to Octopus. However, the deal you have with OVO sounds pretty tasty in the current circumstances and makes sure your payments are consistent.

However, if you’d like to keep the deal, simply let the switch continue.

As for the letters? Erm… Ignoring them is a bad idea. There’s a risk that simply throwing them in the bin without reading them could result in your account getting into a bad state. The absolute minimum you need to do is set up an account with that supplier so you can make payments while you decide where to go next. You are under no obligation to stay with Octopus at all, so feel free to stick with them, keep the switch to OVO going or even go elsewhere. It’s ultimately your choice.

Hope this helps.

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H

Thanks, that's really helpful. I didn't mean ignoring letters completing, just not signing up to the fixed price tariff with Octopus that they were pushing. If I hadn't switched, am I right in thinking I would have automatically been on the variable price capped cost with Octopus? And if I cancelled the switch now it would revert back to that? 

Blastoise186
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Ah ok, gotcha.

Yes, you are correct there. However, be warned that you’d only get about four months of the current prices at variable rate before the price cap changes again, most likely upwards. Depending on your usage, that may not work out as good value as a fixed rate deal.

It’s ultimately a gamble whatever way you go, so please consider your options carefully before deciding what to do.

If you wish to stay with OVO, you have another option. You can keep the switch to OVO going but ask to be put onto Simpler Energy instead. The prices for that tariff will be about the same as what Octopus is charging for their variable rate deal. I think that might be easier to pull off than switching back to Octopus. If you’d like to do this, give the team a call on 0330 303 5063 and they’ll make the arrangements.

Securing energy by zapping security bugs... For that is The Blastoise Way!
Jess_OVO
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Userlevel 7

Great to see some tip-top advice offered as ever from our super-user, @Blastoise186.

 

Just to clarify, @Howkflakegirl, as you mention your switch date is later this month, your energy is still being supplied by the existing supplier until this date. Either way we recommend contacting this supplier as soon as you move in, this makes sure there’s no unexpected objections to a switch, if you still plan to join us.

 

As @Blastoise186 mentioned all suppliers are required to offer a variable plan which is protected by Ofgem’s variable price cap - read more about this here.

 

You might also want to check out the discussions our members have been having on the best renewal options in the current energy climate.

 

I hope this helps. 🙂

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