A ban on the forced installation of prepayment electricity and gas meters will last just six more weeks, Ofgem has confirmed.
The regulator earlier this month ordered energy suppliers to halt the practice of forcing customers to have prepayment meters fitted against their will if they have fallen into debt. The intervention came after an investigation by The Times, which saw some debt collectors working on behalf of British Gas were allegedly breaking into people's homes to install prepay meters and ignoring signs of extreme vulnerabilities.
The temporary ban on installing prepayment meters under warrant will last until March 31, despite calls from politicians to outlaw the practice. Just weeks ago, the business and energy secretary, Grant Shapps, had warned suppliers that moving customers onto prepay should be a last resort, and that they must first take every step possible to support those in financial difficulty.
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In a letter to energy firms published this week, Ofgem confirmed the temporary ban includes the remote switching of smart meters into prepay mode, as well as physical meter installations through the use of court warrants. However, it's not yet known what will happen after the March 31 deadline, although Ofgem is currently in talks with suppliers.
The regulator has committed to concluding a review on the treatment of vulnerable customers by that date, according to The Guardian, and could extend the ban or make it permanent. An Ofgem spokesperson said this date would be when “the new rules will be ready pending our detailed investigation” and that it had asked suppliers to halt forced installations until then.
Suppliers have argued that installing prepayment meters allows them to recover debts and stops consumers amassing larger amounts of debt. Ofgem’s chief executive, Jonathan Brearley, told Sky News: “We are aware of the difficult balance here as unrecoverable debts from some customers may then be recovered from the bills of paying customers, many of whom are themselves struggling with paying their bills given the wider affordability issue.
“We have an ongoing programme of work to assess costs to suppliers from customer debt. Once we have analysed your responses to our request for information on debt, we will be able to determine what action we need to take and, if an adjustment is required, we will act quickly.”
The prospect of a return to forced installations as soon as April raises concerns. Citizens Advice Newcastle joined the call for new protections to stop people being fully cut off from energy if they could not afford to top up and said there must be a total ban on energy companies forcing those already at breaking point onto prepayment meters.
The charity has previously warned of its fears that people could die in their cold homes amid figures from the CAB that 3.2 million people in the UK had been left without energy at some point last year after struggling to top up their meter in the cost of living crisis. An estimated 600,000 people were forced to make the switch away from credit meters after racking up debt with their energy supplier in 2022.
Ofgem has begun preliminary work on a social tariff which could cut bills for low-income households. It is also studying how to reduce the cost of prepayment tariffs to bring them in line with direct debits.
MoneySavingExpert.com founder Martin Lewis has previously said moving customers onto prepay meters meant many would essentially self-disconnect from gas and electricity, adding that energy firms shouldn't be let off the hook if they blame third-party contractors for any failings.
There is no formal appeals process for forced prepayment meter switches. If your supplier hasn't followed the correct process, or has put you on prepay when it shouldn't have, you should raise a formal complaint.
Before your supplier switches you to a prepayment meter, it should:
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Have a valid reason for the switch: This can include recovering a debt you owe.
- Communicate clearly: Your supplier should give its reasons for the decision and outline any other options you may have.
- Provide at least seven working days' notice: You shouldn't find being switched to prepay comes out of the blue.
- Check whether you're vulnerable: If your vulnerability means it would be unsafe or impractical for you to be on prepay, the switch shouldn't go ahead.
- Get a court warrant: This is only relevant where you have non-smart meters and you've refused to communicate with your supplier about a repayment plan.
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