Energy firms must stop forcing energy customers onto prepayment meters
Energy suppliers should stop moving customers over to prepayment against their will, the government has demanded, after some have been left without gas and electricity.
Business and Energy Secretary Grant Shapps has written to energy firms asking them to take every possible step to help customers in payment difficulties before moving them onto prepayment meters.
Numbers of homes whose energy meters have been changed from standard energy meters to prepayment ones have soared in the past few months. Some in vulnerable situations have been left without electricity and gas as a result.
The process required a court warrant. But courts are overwhelmed with applications and, according to the government, huge batches of disconnections have been approved in minutes.
It is calling on energy firms to share the number of warrants to move customers to prepayment meters they have applied for in recent months. This will reveal which firms are meeting their responsibilities, and which aren't.
In addition, energy regulator Ofgem said it will review whether companies have taken enough care over decisions to put customers onto prepayment plans. Ofgem Chief Executive Jonathan Brearley said: 'If we find that they have not taken due care in this process, we will take further legal action against them.'
See what help is available if you're struggling to pay your energy bills, and read more about our cost of living campaign.
What are energy companies' responsibilities if you can't pay your bills
While households can be forced to have a prepayment meter if they are in debt to their energy company, this should only be used as a last resort, under energy regulator Ofgem's rules.
These state that your supplier can't make you move to prepayment if it isn't safe or practical, for example:
- you're disabled or have a mental health condition which makes it hard to access, read or use your meter
- you have an illness that affects your breathing
- you have an illness made worse by the cold
- you rely on medial equipment that needs electricity
- your meter is hard to reach (e.g. above your head) or access (e.g. in a shared cupboard for which you don't have a key)
- it's hard for you to access a shop where you can top-up.
They also have to have followed the following steps:
- they have to have offered you other ways to repay what you owe (e.g. a repayment plan or paying towards your energy costs through your benefits);
- they have to have given you at least 28 days to repay your debt before telling you they want to move you to prepay;
- they have to have given at least seven working days' notice before installing a prepayment meter;
- they cannot move you to a prepayment meter if you don't agree you owe them money and have told them this.
You also can't be moved to prepayment if you wouldn't be able to top up your meter. If your gas or electricity stops because you can't afford to top up, this is called 'self-disconnecting'.
Ofgem Chief Executive Jonathan Brearley said that these are minimum standards. Suppliers can voluntarily do more.
What can energy companies do instead?
Government is asking suppliers to voluntarily stop forcibly moving customers to prepayment meters. It has suggested they try offering instead:
- additional credit
- debt forgiveness
- debt advice.
It's also working with energy regulator Ofgem to check that the process for suppliers taking warrants to court is fair, transparent and supports vulnerable customers.
Ofgem said it will look at its rules about when companies can apply for a court warrant to move a customer to prepayment and what steps companies must take first.
Some energy firms are already supporting customers by pausing remote switching of smart meters to prepayment mode, or giving some customers extra credit if they're struggling to pay.
