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Thanks for that, makes their motives clearer.
But then what’s the point of a smart meter if it doesn’t track your consumption and amend sd accordingly. Don’t they have an algorithm for that?
Just feels like I’m constantly overpaying and then having a largish sum (usually £100+) in credit in one and (£40-£50) in the other as they are still working from the old way of estimating my usage and then only confirming it when a meter reading is in. They have my info, just figure it out better and value existing customers, otherwise they like me will leave as you’re giving us no value..
cornelius_blackfoot-
But then what’s the point of a smart meter if it doesn’t track your consumption and amend sd accordingly.
Smart meters avoid the huge expense of paying people to go around physically reading meters.
Having access to accurate and recent readings can make estimations slightly less inaccurate but it's still complete guesswork.
For example, the smart meter you have has no idea about the radical changes in your household since this time 12 months ago.
Greenbank
The whole business plan of these companies are based on a few things:-
a) Charging the same DD over the entire year so that the majority of customers can budget accordingly. (Most customers wouldn't like being billed for actual usage, i.e. £20 in summer months and then £100+ in the winter months.) They give discounts for payment via DD to incentivise this.
b) Since charging the same DD over the entire year means someone has to be in credit and someone in debit at various points over the year, the companies want to make sure it's not them owing money, since that costs them money.
(Even though if all customers were equally distributed over the year in terms of break even point then, as a company, there wouldn't be meaningfully out of pocket or massively in credit at any point during the year. It would be a lottery for individual customers though.)
c) To minimise owing customers money, if there's a chance, based on a customers current DD and balance, that the customer may go into debit during the winter months then the company will look to avoid this by increasing the DD to claw some of that back, and then eventually reducing the DD once enough of a credit is built up that the customer will not go into debit at any point during year.
So, vaguely shitty practices but you can see why they do it.
MSE has a section on the rules about how they should set fair DD values and also give you money back if you've built up a significant surplus:
https://www.moneysavingexpert.com/utilities/lower-energy-direct-debits/
(Scroll down to Step 2: Ask for your money back)
A smart meter doesn't affect any of this really as nothing can predict your future usage accurately.