Is OVO now excluding summer when setting minimum Direct Debit amounts?

Hi @MCH59 - many thanks for your quick reply. So, not a glitch, alas.

I’m now trying to understand what will happen to the minimum payment after 31 March 2024 on the new calculation. 

Currently, if someone is paying the required minimum, it’s their Future Annual Consumption divided by 12. From now until March 2024, under the new method, it’ll be their estimated Winter Consumption, divided by 6 (which of course means a higher minimum payment for millions this coming winter, quite aside from the price cap increase looming in January).

But what happens after 31 March 2024, in terms of the minimum Direct Debit methodology? Will it be back to Future Annual Consumption, divided by the remaining months to 31 March 2025?

EDIT: Sorry, I see that you have already added to your answer and addressed this point. (I was too busy typing to notice!)

Well, I am vacillating a little on this; but once it has settled down, IF tariffs remain the same, which of course they won’t, would the payment not remain the same if annual consumption is steady? … the rider on that being that it won’t fully settle down until the end of March 2025, because they’ve changed it halfway through what I assume is a new standard 12-month cycle for everyone on a Simpler tariff. 

What I am guessing will happen is that, come 1st of April 2024, it will be 12 months worth of future energy use, plus costs, less payments, divided into twelve equal monthly payments, leaving you with close to a zero balance on 31st March 2025 if you make the suggested minimum payments … which is fundamentally how the the old direct debit calculator should have worked, but self-evidently didn’t. because it seemed to have found a thirteenth month from somewhere. 

TBH, I don’t know and I feel I am making too many assumptions here. My head hurts and I really need to have a poke and a play with the calculator to get my head around it.

Allow me to use some of the sekrit powers that a Forum Volunteer gets. :D

You are 100% correct. The system has recently been changed to target ALL Simpler Energy plans to “end” on the 31st March each year for the purposes of the number crunching - this does NOT mean the contract itself ends, just the annual billing cycle used to run the numbers.

@Blastoise186 

Fabulous stuff. Thanks for confirming that.

Mark

We have been watching you recently and your assistance has been most appreciated.

If you keep this up… Something good may happen...

Tim had a word during the week ;)

@Blastoise186

Just so I’m absolutely clear in my own mind about all of this…

From screenshot #1, my required minimum payment (calculated on the basis of my expected annual energy costs) was £87 before OVO’s system change.

From screenshot #2, my new increased minimum payment (calculated on the basis of my expected costs over the next six months only - i.e. autumn & winter) is going to be £108 between now and the end of March.

Supposing no changes to tariff or annual consumption for the sake of simplicity, should my required minimum monthly payment revert to £87 from 1 April 2024?

I had also noticed that 'extra month' and worked out what they do, or rather what their computer programme is doing, and where the extra month comes from..
It's all about the timing of when the calculation is done; and I don’t think it will change in future.

They have always notified me of changes more than half way through a monthly billing period, they call the account balance at that point 'debt' and add it to the averaged estimate for the next 12 months.

That way the computer is always going to be calculating for at least 12.5 to 13 months (more if the account is in debt*) and dividing it into 12 payments.

Many would say that it’s a bit sneaky doing it that way, although the numbers are correct - at the time that the calculation is done.

If you get them to re-calculate just after you have paid a direct debit then the outstanding balance will be lower (only one or two days usage), so the averaged amount to pay each month will be lower.

*I was transferred from SSE last January. The higher winter usage, especially with the high tariff at the time, meant that my transferred account balance was technically £500+ in debt, further increasing what OVO wanted paying each month.

It still is in debt although that debt is reducing rapidly because my current DD payment is over twice my current usage. I calculate that with my current payments that 'debt' will be gone by the end of January 2024, 12 months after I transferred to OVO so to me that's bang on the original target at transfer - although OVO's computer seems to see it differently.

OVO still regularly want to put my DD payment up more. to around 3x my actual usage, simply because of the way that their computer is calculating things, and no doubt the computer will now want to try and put it up even more because it will now only be calculating up to the end of March.

@Nukecad

You could be right; BUT, as chance would would have it, my account cut over to a new billing period yesterday morning and so far there is no a hint of the 13th month behaviour that I would have expected with the old Direct Debit calculator ... in fact, the opposite, my minimum payment has dropped by £1 since yesterday when I would previously have expected it to creep up by £1.

Likewise, my predicted future credit balance for 31st March has increased by £2 since yesterday, whereas I would previously have expected that future credit balance to fall a little.

Time will tell. 

The calculation from 18 hours ago is up above and here is how it is right now: