Why has my monthly Direct Debit payment increased?

We know that no one likes their bills going up. We do our best to avoid making increases to your monthly payments. But sometimes, they have to happen – so we wanted to give a bit more information about why.

Remember, the best way for us to make sure your monthly payments are correct is to regularly send in your meter readings. Knowing how much energy you’re using each month means we can predict more accurately how much energy you’re likely to use in the future – meaning we can work out what your monthly payments should be as accurately as possible. You can submit your meter readings in just a couple of minutes through your online People’s Energy account.

Why is my monthly payment increasing? 

If we’ve increased your Direct Debit, it’s because you’re using more energy than you’re currently paying for. The increase in your monthly payments will help to cover the cost of that extra energy, and prevent your account going into debit (when you owe money). The cost of the extra energy you’re using is spread across those monthly payments - so you don’t wind up with a lump sum to pay off unexpectedly when you come to the end of your contract.

Why is my bill increasing right now?

Over time, people's circumstances can change - and their energy usage can change too. So, we run regular account health check-ups to make sure your Direct Debit matches the amount of energy you’re using. 

There are lots of reasons why your energy consumption might have gone up over the past few months. Due to home working, social distancing and lockdown restrictions, many people are spending more time at home right now – so we’re using our heating, lights and appliances much more than in the average winter.

But there are other reasons why you may be more using more energy than you were previously. For example, your energy usage might have gone up if another person has moved into your home, if an extension has been added to your property, or if you’ve bought an appliance that eats up a lot of power, like a tumble dryer or an electric heater.

I’ve just joined you. Why has my Direct Debit gone up already?

If you joined People’s Energy recently but your Direct Debit has gone up, it’s usually because we now have information that shows you’re likely to use more energy than we originally estimated when you first signed up.

When you sign up with People’s Energy, we ask you to provide us with your annual energy usage. It helps us work out how much energy you’re likely to use in the year ahead. Some people opt for us to estimate their annual energy usage when they sign up, rather than providing an actual figure for how much energy they’ve used over the past year. We use average energy consumption figures from Ofgem to do this.

Sometimes this estimate doesn’t line up with the actual amount of energy you use. If that’s the case, and you’re using more energy than we estimated on your behalf, then your Direct Debit may set be too low.

We normally get the information we need to check how your actual energy usage compares to the usage we’ve estimated for you shortly after you’ve switched. It includes your latest meter readings, and the historical energy consumption for the property you live in. At this point, if we can see that you’re using, or likely to use, more energy than you’re paying for, then we’ll adjust your monthly payments to cover the cost of that extra energy – and stop your account balance from slipping into debit.

Why have my monthly payments gone up when I’m on a fixed rate tariff?

On a fixed rate tariff, the price you pay for your energy is locked in – that means that even if the wholesale price of energy goes up (or down), you’ll always pay the same price per unit.

However, it doesn’t mean that the amount you pay by Direct Debit each month is also fixed. If you’re using more energy than we calculated for you when you signed up, or at your last account health check-up, then we still need to adjust your payments to make sure you’re paying enough for the amount of  energy you’re using.

My account is in credit – so why has my Direct Debit gone up?

If your account is currently in credit, but we’ve increased your monthly payment, it’s because our account health check has shown you’re using more energy than we expected, and you’re likely to tip into debit over the remaining months of your contract.   

A little bit of debit on your account is normal, especially after the winter – it’ll be balanced out by the credit you build up over the summer. But if you’re using a lot more energy than you have done in the past, that credit gets eaten up much faster. So, if we think that you’re likely to go into significant debt - even if there’s some credit in your account right now – we’ll increase your monthly payment, to help you avoid a surprise bill at the end of your contract.

Sending in your meter readings regularly helps us make sure you’re paying the right amount to cover the cost of your energy. It means that when we check in on your account, we don’t have to rely on estimated readings, which often don’t accurately reflect the amount of energy you’re actually using. You can submit readings through your online People’s Energy account.

How do you work out that my monthly payment needs to change?

To calculate how much you need to pay (and if your payment needs to go up, or go down), we make a prediction of how much energy you’ll use over the months ahead. We look at three sources of information to do this:

• The amount of energy you’ve used in the past, based on the meter readings you’ve sent into us. If we have to use estimated readings, it’s harder for us to get a good idea of how much energy you’re really using – so let us know your updated readings every month if you can.
• The amount of energy that has been used in your property over the past three years
• The time of year. So, during the winter, we know you’re likely to use more energy, and in the summer, you’re likely to use less

Can I make a one-off payment instead, to avoid my Direct Debit going up? 

Yes. If it suits you better, it’s possible to make a one-off payment to balance your account. But, if your account has slipped into debit, or we predict it will soon, it’s best to consider the increase to your monthly payments that we’ve recommended. Increasing your monthly payment means you’re able to spread the cost of the extra energy we’ve predicted you’ll use, so you pay a bit more each month, rather than having to shell out a chunk at the end of your contract.

What do I do if I can’t pay?

We understand that covering energy bills in winter can be hard, and that this year is more challenging than ever. We're here to help - so if you're worried about paying, please reach out to us. There are options we can take you through for making your monthly payments more manageable, whilst avoiding building up a debit balance. Our advice team is available to talk Monday to Friday, 9.00-5.00pm, on 0131 378 7120. You can also get more advice on what to do if you’re struggling to pay over at our Help Hub.

How can I get more information about my payments?

If you’d like to discuss your Direct Debit with one of our team, the best way to contact us is by email customerservices@peoplesenergy.co.uk. You can also reach us:

• Via livechat on our website
• By phone on 0131 285 5510

We’re dealing with a high volume of calls right now, so please bear with us – we will get to you. Thanks very much for your patience.