Octopus Energy issues £93 update to customers with a Direct Debit

Octopus, which is rivalled by British Gas, EDF, EON, Ovo and more, says people with Direct Debits are saving a cool £93 each.

Octopus Energy has issued a £93 update to anyone who pays by Direct Debit. Octopus, which is rivalled by British Gas, EDF, EON, Ovo and more, says people with Direct Debits are saving a cool £93 each.

Octopus explained: “Set up a monthly Direct Debit online to save around £93 per year. A steady monthly Direct Debit is our most popular way to pay, because it allows you to spread your payments evenly across the 12 months, rather than paying less in summer and much more over the winter.

“Because this method costs us less in admin, your unit price is less, saving the average home on our variable tariff around £93 a year.”

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Octopus added: “We never increase your payment just for the sake of it. Overwhelmingly, customers owe us more money than we owe them. We run thorough, frequent ‘health checks’ on your account to make sure your balance is where it should be and your payments are at a good level.

“The reason we change Direct Debits is to make sure you can cover the cost of the energy you use and get to a healthy balance – we explain a bit more how we work out what’s healthy later on.

“You’re always in control of your payments, and can change them online or by talking to our team.”

The firm said: “When you join us, we take the unit rate of the energy tariff you have with us, and multiply it by how much energy we expect you to use over a year.

“We get the information about the energy we expect you to use from your meter via an industry process, and we also look at the meter reading you give us.

“We also add on your daily standing charge. We use all this information of these to calculate your annual energy costs. Then we divide that into 12 to get your monthly Direct Debit amount.

“We do it this way so customers can pay the same amount year-round. Typically, people use 50% more energy in Winter than in the Summer but prefer a fixed monthly amount to smooth this, and reduce surprises. This is your base amount.

“We then work out where your balance is expected to be in April – if it’s below target, we’ll work out the difference and spread this over 12 months as a balance-adjustment and add this amount to your suggested monthly payment.

“We then email you to tell you any proposed changes and give clear options – and give you plenty of time to tell us if you’d rather not make the changes. If your emails bounce, or if we don’t have an email address for you, we’ll send by post instead.”