How Balance Forecast demystifies energy payments
With the global energy market costing nearly 3 times as much as a year ago, we might have recently asked you to increase your monthly direct debit payment to make sure it was enough to cover the energy you are using.
When you get your energy from us, you're always in control of what you pay – both through your online account and app, and by talking to our team. But we know lots of people might have questions about how we work out their payment amount, and how much it really needs to go up by.
We've created Balance Forecast, a new account tool to shed light on why we set Direct Debit payments the way we do. Read on to understand how it works.
Check your Balance Forecast
This account tool maps out your energy balance over the next year, so you can see the impact of raising or lowering your Direct Debit. You can use it to test out different payment amounts, decide on one you're comfortable with, and clearly see what your balance should look like in a year's time.
Balance Forecast is available for customers who pay by monthly Direct Debit and are on a standard Fixed or Flexible tariff.
The papers legitimately called it "hot stuff", but we'd love you to try it out for yourself and see if it helps you plan ahead a little better in the crisis.
The majority of customers use more energy in Winter and less in Summer, but pay for their energy via an even monthly payment throughout the year. That means it's normal for your account to build up credit in the warmer months to see you through the colder months when the heating comes on.
Balance Forecast displays:
- Your monthly payment (in pink)
- Your predicted monthly energy charges (in electric purple) – we work out what you'll use based on all your past meter readings multiplied by your current energy prices)
- Your balance at the start and end of each month (the light blue zig zag)
You can plug different monthly payment amounts in at the top to see where they'll take your balance in the future. Too low to cover what you're using and build Winter credit – you'll see your balance line fall below zero. Too high, you'll see your credit gradually accumulate. If your Direct Debit is set correctly, your balance should even out over the course of the year.
Once you've decided on a payment amount, you can change your Direct Debit yourself online. If you've chosen an amount that could lead you to build up debit, we just ask that you speak to our team to change it.
Who can use Balance Forecast?
Balance Forecast is available for customers who...
- Pay by monthly Direct Debit
- Are on a standard Fixed or Flexible tariff
If you've recently changed tariffs, you'll need to have had a statement since then before you'll be able to see Balance Forecast.
If you're on a smart tariff like Go or Intelligent Octopus, your complex energy use and pricing structures make Balance Forecast a little trickier, so this feature isn't available for you – but we're always here to help if you'd like to talk about your energy payments.
Crystal Ball mode is only available to customers on our variable tariff, Flexible Octopus, because changes in the energy price cap won't impact you in the same way if you're on a fixed price tariff.
New on Balance Forecast: Crystal Ball mode 🔮
Two common questions emerged from customers who tried Balance Forecast v1. One, how will the new price cap in October likely affect my energy charges (and so, my future balance)? Two, how will the government’s cost of living support impact energy payments?
Version 2 of Balance Forecast aims to help.
Crystal Ball mode helps customers on Flexible Octopus get a sense of what the expected price cap increase and government rebate will mean for their energy costs. As the name implies, it should be taken with a grain of salt because it's too soon to know what actual prices will look like in October and January and the nature of the government rebate could change at any time. But we're using the most up to date information and predictions from industry experts to help you plan ahead and navigate through the crisis.
How do we calculate your Direct Debit?
It’s taken a vast and careful effort to calculate and develop a fair way to calculate Direct Debit payments and automatically keep balances in check for millions of customers. We know how important it is to get it right. We process 3 million payments a month – that’s around 100,000 payments a day – and we take the responsibility incredibly seriously.
We think it's most important to put customers in control, and give them all the info to make their own decision about what they should pay. That's why we made Balance Forecast. We’d love to see the same transparency from other suppliers.
If you'd like the detail, we've written at length about how we work out what you should pay.
Worried about covering your energy bills?
Please, please don't hesitate to talk to us. We're here to help, whether by pointing you towards the government support available to help with the cost of living, other government support schemes, and our own dedicated customer support via our £15m Octo Assist fund.
How Balance Forecast came to be
Following the April Price Cap increasing, many suppliers began suggesting customers increase their payments. It led to a lot of headlines suggesting suppliers were increasing payments by too much. So we came up with a way to show our customers our working...
Lots of people have been asking how we work out their Direct Debits, so @pete_miller's creating a new feature to help (collabing w data viz whizz @robhawkes).— Octopus Energy (@OctopusEnergy) May 19, 2022
Here's a sneak peek at your Balance forecast 👀 Give Pete your thoughts in the 🧵👇 pic.twitter.com/WmxtH0WY8d
A few weeks later, we launched Balance Forecast v1 for anyone on one of our standard tariffs who pays by monthly Direct Debit. (Smart tariffs like Agile Octopus involve more complex energy consumption patterns and pricing, so aren't included in Balance Forecast.)
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