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Energy suppliers doubling customers’ direct debits

Energy customers are increasingly seeing unjustified increases in their direct debits, according to an inquiry as Ofgem launches an investigation into companies.

A survey of 41,000 people by Money Saving Expert found that 30 per cent of British Gas, Octopus and Shell Energy customers said they would double their direct debits following the increase in the energy price cap.

About 27 percent of Eon customers told Money Saving Expert that their direct debits had doubled, as did a quarter of EDF customers.

The price cap rose from £1,277 to £1,971 last month, a 54 per cent rise.

Last week, Business Secretary Kwasi Kwarteng accused energy companies of intentionally overcharging customers to shore up their own finances.

Energy companies are allowed to increase their customers’ direct debits based on estimated annual energy consumption and increasing tariffs.

But activists say some appear to be taking advantage of the situation to prop up their balance sheets by demanding more than necessary payments, in violation of the rules.

Ofgem has launched an investigation into the market and has asked companies to release their data.

Money Saving Expert’s Martin Lewis said: “While higher direct debits don’t mean you end up paying more – any overpayments ultimately have to be repaid – it does mean that far too much money is now pouring out of accounts, which is often a nightmare amid the cost of living crisis.”

Octopus Energy said its own analysis of customer account data showed that just 15 percent of borrowers who had been using the standard rate for more than three months had doubled their monthly payments, with a median increase of 59 percent.

A company spokesman said: “The crisis is real – energy customers are stressed by huge bill hikes – but people need help, not misleading surveys.

https://www.telegraph.co.uk/money/consumer-affairs/energy-suppliers-doubling-customers-direct-debits/ Energy suppliers doubling customers’ direct debits

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