When you pay your gas and electricity bills by direct debit and know you're in credit, it can be baffling when your energy firm announces that it's increasing your payments.
But in a recent survey of Which? members, one in five who pay by direct debit said they were in credit to their energy firm.
Separately, half of those surveyed told us that their direct debit payments had changed from the original amount they agreed to when they signed up to their energy deal.
Find out why this can happen, how to check whether your payments are correct, and what to do if you think they're wrong.
Yes it can. A fixed deal sets the price you pay for the daily standing charge and the unit rate for the period of the contract. It does not fix your payments. These depend on how much gas and electricity you use.
Standing charge - a daily amount payable regardless of whether or not you use any gas or electricity.
Unit rate - the price of a kilowatt hour of gas or electricity.
Plus check out the Which? Money Podcast episode below where we discuss how direct debits work and what to do if you're in credit to your energy firm.
If you use more gas and electricity than your energy company expects, it can increase your payments to cover it. If you use less than expected, your payments should drop.
You might use more energy than expected for various reasons, including:
Your energy company calculates your payments based on 12 months' worth of gas and electricity usage, divided into equal monthly instalments.
So even if you are in credit now, it might have calculated that, after a year's usage, you'll be in debt. For example, at the beginning of winter, your account may be in credit (which you have built up over the summer). You would expect this to deplete while you use more gas for heating, or electricity for lighting, in the next few months.
But if your payments over a year won't cover your total usage, your energy company will need to increase them.
Your payments might also rise if your fixed deal ended and you were moved on to your energy firm's out-of-contract (or default variable) tariff automatically because you didn't choose a new deal. An out-of-contract tariff is usually not the cheapest deal available, so your payments may be increased to cover the higher cost.
If you are on a variable deal and your energy company has increased its prices, then your direct debit will likely increase to cover this.
But there's a third reason your payments could increase in winter - if you are with certain energy companies.
We've come across several applying a 'winter uplift' or 'winter weighting' to customers' direct debit payments in the colder months. This means that you pay more in winter and less in summer.
This is to help suppliers manage their cash flow, according to consultancy Cornwall Energy, and help reduce levels of customer debt. But affected customers lose the benefit of spreading their energy costs equally throughout the year. Instead you'll have to budget for bigger energy bills in winter.
Energy firms which do this include:
You can opt out of Igloo's winter uplift. So Energy customers can switch between seasonal and equal monthly payments by giving seven days' notice.
Half of those in our survey told us that their direct debit payments had changed from the original amount they agreed to when they switched provider. Of these, around two thirds found that their payments increased.
Most said that the increases were £20 or less per month. But over a year this can add up to £240, so it's worth keeping an eye out if your direct debit is increased.
A few (5%) said their direct debits were increased by more than £50 a month.
When you switch, your direct debit payments are based on the amount of gas and electricity you have used over the past year. If you provide these figures (usually in kWh) you will get a more accurate quote.
If you don't provide your actual usage data, or you ask your company or price comparison website to estimate, then your payments may be less accurate.
For example, some price comparison websites will provide a quote based on average figures for a medium user (as described by Ofgem). If your gas and electricity use differs from this following your switch, your energy provider will adjust your direct debit to match.
When your company changes your direct debit payments, it should tell you in advance (usually 10 working days). That's according to the direct debit guarantee.
Many companies explain why your direct debit is changing, but if yours hasn't, get in touch to request an explanation of how it has calculated your new payments.
You can challenge a direct debit change if you don't agree with it. Check whether your account is in credit and whether your monthly payments are likely to cover your annual usage (check your online account or latest annual statement for this).
You can also request that your direct debit payments are lowered via many energy firms' websites. For example British Gas, Eon, Npower, Octopus Energy, Ovo, Scottish Power and SSE all let customers adjust their direct debits in their online accounts or apps.
But you can't necessarily change it to any amount you wish. Eon, for example, limits changes to 20% of your current payments. Npower suggests an alternative payment amount that the customer can accept or reject, which it explained 'prevents wild fluctuations for the customer the following year'.