By Nicole Wilson•
We buy energy for our members in advance. So the way we charge you is a little different to some suppliers. Here we explain payments, statements and your account balance at Bulb.
Most energy companies charge you for energy ‘in arrears.’ This means they’ll take a payment from your bank account each month for the energy you’ve already used. At Bulb, we take payments in advance to cover your energy usage for the month ahead.We ask members to pay this way because we buy our energy 4 months in advance. This practice is called ‘hedging’, and it helps us balance out the peaks and troughs of a volatile energy market. If you imagine us as a big energy shop, we stock our shelves with gas and electricity well ahead of time. This stops us paying the market price for our energy on the day. Hedging helps us to keep our costs down, so we can pass the savings onto our members.
When you sign up to Bulb, you’ll get a Bulb account. This is where we keep your advance payment as credit. Your account balance should always have enough credit in it to pay for the next month’s worth of energy. It’s all part of an up-front payment ecosystem that helps every Bulb member to save on their energy.
Charging up front means we suggest a set monthly payment for every member, even though you’re on a variable tariff. Knowing how much you’ll pay towards your energy each month is handy for budgeting - and it means there are no nasty surprises in winter, when you’re likely to use more energy.
So, how do we set an advance monthly payment before you’ve used any energy? Glad you asked. When you first sign up to Bulb, we ask for some details about your property to estimate the amount of energy you’ll use during your first year. We divide the total projected cost between 12 months to get your quote, and we use that to set your monthly payments.
Naturally, the longer you’re a Bulb member, the better we’ll get to know your actual energy usage through your meter readings. We’ll suggest a new payment amount if you’re regularly paying too much or too little for your energy. This might happen if we’ve overestimated your usage based on a previous tenant; if we change our energy prices; or if your energy usage changes significantly. Maybe you bought an electric vehicle, installed new medical equipment at home, or finally took the plunge on that inflatable hot tub.
You can see your suggested payment amount in the payment settings section of your Bulb account.
Your monthly payment is designed to cover your energy use over the year - but it’s not a fixed price for your energy. You’ll still only ever pay us for the energy you use. Let’s look at how that works.
When we take your monthly payment, it goes from your bank account into your Bulb account. When there’s money in your Bulb account, this is called credit. You might earn extra credit in your account for referring your friends and family to Bulb, too.
The day we take your bank payment stays the same each month. This date is the start of your ‘billing period’. Each energy statement we send will represent one billing period - which is just a fancy way of saying one month. If we take your bank payment on the 8 January, your billing period will run from 8 January to 7 February.
Your monthly statement will show how much energy you've used in kilowatt hours (kWh), as well as how much it cost on your tariff. We’ll take this total from the credit in your Bulb account (not from your bank). Any credit left over in your Bulb account helps to build up a buffer so you can continue paying the same amount each month, even over winter.
If the credit in your Bulb account can’t cover the cost of your energy usage, your account will be ‘in debit.’ This means your balance is negative. If this happens, we might suggest changing your monthly payment to avoid building up debt, or you can make a one-off payment to get back on track. You can check your balance, request a refund, or make a one-off payment at any time in your Bulb Account.
And that just about wraps up how payments work at Bulb. You can find out more about payments and tariffs on our Help Centre, and we’ve written a guide to understanding your energy bill, too.