The latest energy price cap predictions from leading industry analysts at Cornwall Insight are forecasting gas and electricity bills of £3,582 per year from October, before rising to an eye-watering £4,266, which would see the average household hit with a bill for over £500 in January alone.
Millions of households across the country are seeing their budgets stretched to the max as they try to combat the cost of living crisis. However, many may not be aware they might be able to bring their next direct debit down, especially if they have been making energy-saving cuts around the home recently.
The information came to light recently in a written response by Energy Minister, Greg Hands MP to a query from Labour MP, Dan Jarvis. And it could be a game-changer for many.
Mr Jarvis asked: “What steps his Department is taking to support people whose direct debit for energy bills has been significantly increased by their energy provider without notice causing them to enter an unarranged overdraft?"
Mr Hands responded: “Suppliers must take all reasonable steps to ensure that customers’ direct debit payments are based on the best available information.
“A supplier should explain the reasons for changes made, with at least 10 days advance notice before the next payment is taken.”
He added: “The customer may challenge a proposed increase and renegotiate the payment level.”
Which means, if you submit a meter reading at least 14 days before your next bill is due, when your supplier contacts you to confirm your next direct debit payment - at least 10 days before it’s scheduled to be taken - you can contact them and ask them to look again at the amount they want to take, especially if it’s higher than the previous month and you know your household has reduced its overall usage.
While this may not work for everyone, it’s a good way to start getting into the habit of submitting regular meter readings to ensure your supplier has an accurate picture of how much your household is using.
Ofgem announced last month that energy customers’ money is to be protected under new financial measures to ensure suppliers can withstand future shocks to the market.
The energy regulator has said suppliers will be able to “weather the ongoing storm” of challenges facing the industry, especially over autumn and winter. Proposals include better protecting consumer credit balances if a company goes into administration, ensuring suppliers have enough money during trying circumstances and allowing firms to have sufficient control over key assets.
Ofgem also announced that there will be a tightening on the level of direct debits suppliers can charge customers.
The energy regulator has said the changes will reduce the risk of suppliers going bust and protect the credit balances of energy customers if they do.
A safety net ensures customers are quickly moved to a new supplier with their credit balances intact if a supplier does collapse.
To keep up to date with the cost of living crisis, join in the conversation on our Money Saving Scotland Facebook page here, or subscribe to our newsletter which goes out three times each week - sign up here.
READ NEXT
- Five ‘energy-draining’ household appliances and how much they add to your bill every day
Martin Lewis issues new energy bill warning for people paying by direct debit
People on a low income may qualify for cash support from their local council
DWP loans worth up to £812 for people claiming certain benefits can be repaid over two years
Low-income families urged to apply for one-off £267 child payment before schools go back
