Energy companies including Octopus Energy are handing out special payments of up to £200 to certain customers, but households must come forward and apply for the cash. Many direct debit customers may not realise they have built up credit on their accounts, which happens when they are charged more than the energy they have used.
How credit builds up
This situation also applies to other suppliers such as British Gas, Eon, and OVO. Suppliers keep bills stable throughout the year, but households often pay more than the energy they use, particularly during spring and summer when heating usage drops. The overpaid money accumulates as credit on online energy accounts, and customers can request some of it back.
It is worth checking how much credit you have before making a snap decision. The cash on accounts is intended to help when energy costs are higher during winter, but some households build up more credit than they will ever need.
Typical credit amounts
The typical credit amount is around £200, but it could be much higher for some customers. Experts say that if someone has £500, this is likely too much, so it is worth asking for some of it back. However, it is always a good idea not to empty accounts completely, as credit may be needed when costs rise later in the year.
Thomas Drury, a money saving expert at The Investors Centre, explained: "The point of a fixed direct debit is that you smooth out the cost across the year. If you claim back too much in summer, you may simply create a shortfall later when usage goes up again. That can lead to a higher direct debit, a catch-up bill, or pressure at exactly the wrong time."
He added: "If your balance is climbing month after month, that suggests your direct debit may be set too high. That is when it is worth asking your supplier to review it."
What to consider before claiming
Drury continued: "If you have around one month's payment in credit, that may simply be a normal buffer. If you have two or three months' worth sitting there, especially heading into summer, that is worth questioning."
He gave an example: "A household paying £150 a month with £100 in credit may not need to do anything. But a household paying £150 a month with £500 sitting in the account should ask why the balance is that high."
