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Smart Meters and Direct Debits


Why do you not take the actual usage so that I am not in credit or debit each month

 

My business supplier manages to do this 

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Best answer by Gwyndy 27 August 2021, 11:41

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@thunderbird167

Are the readings on your statement estimated?

Do you have smart meters, are they sending readings automatically, you can check by looking at your meter reading history in your account, in not sending readings, are you reading the meters and submitting them to PP, if you don't send readings or they are not obtained remotely, estimates will be used.

 

Why do you not take the actual usage so that I am not in credit or debit each month

 

My business supplier manages to do this 

Well, Pure Planet, as with most (all?) domestic electricity suppliers, take your payments via some form of ‘averaged’ monthly Direct Debit.

In view of the fact that you pay Pure Planet in advance for your usage (remember that Direct Debit you paid on switching day?) it would be slightly difficult for them to charge you for your ‘actual usage’ to ensure you are not in credit or debit each month - short of a psychic foreknowledge of what your next month’s usage is.

Pure Planet’s method of splitting your payments into two six monthly periods was made fairly clear on your initial paperwork (well, email, but I hope you get the idea.)


What your business supplier manages to do, is entirely their commercial operating decision, not Pure Planet’s. As a businessman yourself, I’m sure you firmly believe that you are best placed to know how your business should operate successfully, and I have no doubt Pure Planet have people who are responsible for making sure theirs does as well.
 


 

No they are smart meter 

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No they are smart meter 

In that case as @Gwyndy said, you pay the same amount each month with a 60/40 winter/summer split, and they are calculated to pay for your years usage. 

 

 

I understand how the annual usage is calculated but the whole point of a smart meter is to calculate actual usage and this is what should be billed

@thunderbird167 But it is what is billed unless an estimated figure is being used. The latter sometimes happens due to when the smart meter reading is picked up compared to the time the bill is prepared. You are though beingbilled for what is used.

I understand how the annual usage is calculated but the whole point of a smart meter is to calculate actual usage and this is what should be billed


What you receive via email (despite the fact that Pure Planet at one point called the download a ‘bill’) is a ‘Statement.’ 

Your Statement contains several elements - including:

Your bill - which as you have a Smart Meter should be charged on approximately ‘actual’ usage. 

Your payments - which are an entirely different thing to your bill, are calculated to cover your estimated annual usage, partially to avoid any sudden shocks, partly because it’s probably much easier for Pure Planet than constantly amending the Direct Debits each month.

They don’t necessarily have to match exactly, provided Pure Planet are happy that, over time, you will roughly achieve equilibrium.

Even if Pure Planet charged you the actual amount of your ‘bill’ each month, you would still have a credit/debit balance because your payments are made in advance - you’d be paying ‘last month’s bill’, for ‘next month’s usage.’

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@thunderbird167

What you are asking for is payment in arrears for energy used, but, as  many energy companies are now using the advance monthly direct debit method of payments ( but don't utilize the 60/40 split as PP do ) and these can only be based on an estimate of future usage as without a crystal ball it is impossible to know what your actual usage will be.

The meter readings are used to help keep your account on track.

If that is the case they need to change

 

My business energy supplier has no problem with billing for actual usage and the sums are far greater than domestic usage


Billing in advance is quite simply outdated and wrong 

 

Well I can’t comment for anyone else on this forum, but when I signed up, I agreed to Pure Planet’s terms and conditions, which included my first payment being taken on switching day, and the payments split irregularly over two six-month periods (something which a number of people have since complained about.)

Changing to paying in arrears just because some people believe ‘billing in advance is outdated and wrong’ (and as we keep pointing out, you are ‘billed in arrears’) would likely cause havoc with Pure Planet’s cashflow, and their invoicing/payment systems, which have all been set-up to deal with their pre-determined way of receiving their income.

I would suspect (lacking as I do, any intimate knowledge of the inner workings of their mind) that Pure Planet, as they only supply ‘domestic customers,’ have little interest in what ‘business energy suppliers’ are doing, just like your domestic mobile phone contract tends to be nowhere near as good as a business one.

No business I have ever worked for, including one which supplied various home heating fuels, charged domestic customers in arrears, although they all allowed business customers at least 30 days credit.

If that is the case they need to change

 

My business energy supplier has no problem with billing for actual usage and the sums are far greater than domestic usage


Billing in advance is quite simply outdated and wrong 

 

They are not billing in advance. Your bill is in arrears for energy used. 

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If that is the case they need to change

 

My business energy supplier has no problem with billing for actual usage and the sums are far greater than domestic usage


Billing in advance is quite simply outdated and wrong 

 

As even more energy companies are now use the payment in advance system, I would suggest that "billing in arrears as a method of payment is the one which is " outdated and wrong " 

Payment in advance had always been the method of payment employed by Pure Planet since it's inception, and I suspect they have no intention of changing their business decisions

@Duppy But they are not billing in advance! They bill in arrears for energy consumed. We make payments on account but that is not paying a bill. Against the credit held a bill is presented for energy consumed. But it is certainly not billing in advance, very far from it. I have not yet had a bill from PP for energy I might consume. All my mine since September 2018 have been in arrears for what I have consumed.

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@G4RHL 

Agreed, which is why I said payment in advance, not billing in advance.

 

 

 

@Duppy Indeed. Some quite basic stuff here that it seems people don’t take on board. We make a payment on account, we do not pay in advance. That is exceptionally common in the business world and from a book keeping perspective it is recorded as such until the bill arrives.

From another perspective HMRC like to tax you on work in hand which has not been billed!

There is no need for on account paymentswhen the value of the bill is known 

Pure Planet know the value of the energy consumed and that should form the basis of any payment 

 

 

@thunderbird167 It is.  The basis of the payment, that is. It seems you are not looking at this correctly.

The payment is not the actual usage and the question was what stops payment being taken for actual usage

 

It appears the answer is that pure Plant wish to have funds in advance and not bill in arrears as most other companies do

 

Therefore other than not needing a third party to physically read the meter the smart meter does not do a lot

@thunderbird167 you are still not understanding. Pure Planet bills in arrears, based on the meter readings.  
 

A majority of businesses will ask for a payment on account. Even the energy providers often ask commercial customers to pay a deposit against future bills.

Richard

They may bill in arrears but they take the money in advance of the bill so I understand perfectly well

 

This is about when they take funds not when they bill

 

No energy company I have used business wise has ever wanted a deposit in the last 30 years

@thunderbird167 ..they do both in the sense that your account may be in credit or debit. Last month I was in arrears. No payment in advance there. Yes companies do ask for advance payments.  I often saw energy companies with new commercial contracts wanting payments in advance.
 

Of course the whole issue is of little consequence, it is what we are signed up to and what other energy suppliers do with the domestic energy market.

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@thunderbird167

So to distil this, you think the first payment should be taken a little later? see below

There is no need for on account paymentswhen the value of the bill is known 

Pure Planet know the value of the energy consumed and that should form the basis of any payment 

 

 

@thunderbird167

Both of the above statements are illogical and essentially incorrect. 

I disagree with everything you’ve said apart from maybe one point which is it might be fairer overall to take the first payment perhaps a week or 2 after the switch date, although with that comes the risk of default and lost work.

If you ran a business supplying goods to the public I don’t think you’d be dispatching them before you knew the customer had paid UNLESS it was a bona fide credit checked business account with a regular customer. This is no different (and  by the way the vat rates are different for business energy)

If you feel strongly about paying for what you’ve used (which is a very different proposition to when the first payment is taken) the nearest option is to get a PAYG meter (which sadly still has an element of credit inherent in the way it’s used)

or

Having read through this thread it would have been a more viable and honest approach to have said you don’t agree with any energy company having a  positive balance on your account meaning they have your money (that would be at one point in time only, the point at which the statement is produced, not a day earlier or later)

I’m guessing you’d be quite happy if you had used more and the balance was such that they owed you money at that point in time  or perhaps you’d be happy with a system which allowed them to suck money from your bank and sometimes refund into your bank instantly?

You may not be aware of this but some energy companies reduce their rates slightly in return for cashflow, the offer tariffs where you have to pay 2 months upfront; if you think it’s worth it to you and the quote is better overall you might take the chance that they won’t go bust. ) On the other hand you could search for a company that doesn’t take the first payment straight away, with the attendant risk that there will will some defaults so their prices might be higher?)

It’s a hard world out there and the energy system is broken, the most vulnerable and least financially able customers are severely disadvantaged by the switching system, because there is an overlap where you have to pay 2 suppliers at the same time and it’s almost unavoidable. If that had been the thrust of your argument (and if so it should be aimed at the regulator) I’d have some sympathy for your stance.

Go to a garage and fuel your car, tell the garage you’ll pay for the fuel  when you’ve measured  exactly how much you’ve used. (Or if you have a business account at the garage they may allow you to drive off without calling the police after you've “paid” on your business card.) 

 

 

I have no desire to be in credit or in debit to the energy supplier at the point of payment when they know the value of the energy used

 

The analogy with a petrol purchase is pointless as you pay for what you purchase at the time you fill up and what you do with it is up to you just like your groceries 

 

I am amazed at how exercised a couple of people have become over a simple question 

@thunderbird167 its not that we are exercised it is more that we think you don’t understand the situation. An issue created when there is not one.

No issue has been created

I simply asked a question and have had some answers

I have asked the same question on Wotbot so it will be interesting to see what Pure Planet have to say

 

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