To worry that we're going to be hit twice by the energy price cap increase

[Butterlover1]

Because we're on a monthly payment that's the same all year round we build up a surplus of credit in our energy account over the summer to draw down on in the winter and because we're on a smart meter it's a pretty accurate monthly payment which has been calculated to ride out the seasonal peak and trough. If the surplus we're building up now assumes a winter price per unit of energy that's going to significantly increase in the Autumn then isn't it the case that overnight the surplus I've spent the previous 6 months building up won't stretch for the whole winter? So not only are bills going to go up to account for the per unit cost hike, they're going to need to go up further to top up the shortfall in credit I'll have in my account that we were expecting to get us through to mid spring!

Then the same will happen again in January! 😨

It just means that when the unit price goes up your surplus will get used up quicker. It's not a double whammy.

It will cost what it costs. Saving money in the summer will mean you can afford it easier in the winter but you aren't getting hit any more than anyone else.

Yes. We're already in debit on our account, which wouldn't normally be the case in august - and we've been really careful about our energy use.

That's not really how it works. You won't pay twice for the same energy - it's just a matter of timing as to when it goes out.

I'm trying to work out how I'm going to make it work with an 80% increase in monthly payments, not sure I can manage with more on top to cover the shortfall..... Unless I'm over thinking this.

Not really, just think of it as a savings pot. we are in a similar situation and have approx £300 banked but im leaving it because i think of it as already spent money ...... i know ill be thankful for it come winter.

Hmm, OK. Maybe I'm just getting all muddled. Really not sure how it's going to work out come the winter.

Just think of it as a pot of money. You pay x amount in each month, in the summer it builds up a surplus which in normal years would see you through the winter. This year, that surplus won't last the winter, so at some point you'll have to pay more into the pot.

The money you "saved" in the summer was never going to fully cover your winter bills? You essentially overpay in the summer to cover the winter.

If you've given a monthly meter reading they take your last annual usage and spilt it by 12 payments (or they do it on estimate). Usage isn't the same throughout the year. You may use £70 a month in summer but £200 a month in winter.

Your credit will be calculated only once you’ve gone through a whole year. And then it's offset against the next annual DD.

So just say last year you used £70 per month for x3 months £100 per month for 3 months and £200 per month for 6 months that makes your annual usage £1,710.00 and your DD would be £142.50 per month. Just say this year you only use £1,500. You'll still pay the same DD all year but the credit £210 will be applied the following year.

This is all based on current (today's) cost. Once wholesale prices and price caps go up then we'll be paying silly money but the same formula applies.