When you set up a contract with a new energy supplier, they will send you regular instalment bills. These instalments are provisions towards your annual energy consumption. In other words, you pay in advance an estimate of what you are going to consume during the year.
These provisions are usually billed on a monthly basis (but it’s possible to choose bi-monthly or quarterly billing). It would be rather unfortunate if you had to pay for your entire annual gas or electricity consumption in one go! Please note, however, that if you prefer this option, some suppliers do offer it. They frequently offer reductions as well if you choose this option. It’s up to you to decide whether you can afford such an expense.
In addition, the amount to be paid for each instalment is always fixed. It will only be altered, where appropriate, when you receive the annual breakdown for your energy consumption. At that point, if the total amount you have paid in instalments turns out to be higher than your actual consumption, your supplier will refund you the difference. They will also be able to adjust your provisions for the following year based on the new data. Conversely, if your consumption exceeds your provision, you will have to pay the difference.
Each supplier has their own way of calculating the instalment. However, they all use your consumption history, while taking account of seasonal fluctuations.
Everything happens through intermediaries. In practice, the distribution network operator (DNO) for your municipality communicates your energy meter reading to your supplier. The supplier will then be able to work out a consumption estimate for the following year.
If you are moving to a new house which has just been connected to the gas and/or electricity network and no consumption history is available, the supplier will have to rely on other data, such as the size of the house or the number of people in the household.
Note that your instalments will always remain fixed, even if you have chosen a variable-price energy contract. When you choose this option, the energy suppliers include energy price speculations in their calculations to estimate your instalment amount. This means that if the gas or electricity price plummets unexpectedly when your consumption has been estimated, you will be able to receive a generous refund!
As we have explained, the instalment is simply an estimate. Your actual consumption may be higher or lower. If you think the difference will be too great, you can contact your supplier to adjust the instalment amount. If, after adjustment, your instalment still seems too high, please compare prices with other gas and electricity suppliers.
The Energyprice.be team is available to help you by telephone (0800 37 369) if you have any further questions about the instalment system in general. You can also ask us to call you back free of charge. Our advisers will be pleased to help you manage your energy contracts more effectively! If you have more specific questions about how your instalment is calculated, please contact your supplier directly!