personal finance

Only 1,500 people compensated so far over prepayment meters, Ofgem says

Only 1,500 people have been compensated by energy companies for the forced installation of prepayment meters over the past year, figures show.

The energy regulator, Ofgem, said that initial information from gas and electricity suppliers showed that 1,502 customers had received compensation totalling £342,450.

Ofgem said suppliers were planning more payments of about £200,000 for 1,000 more customers, or £200 on average. It added that more than 150,000 involuntary prepayment meter installations had been assessed by suppliers to date.

Last year, the energy watchdog announced a market compliance review (MCR) of customers who had had a prepayment meter installed without their permission between 1 January 2022 and 31 January 2023.

The shadow energy secretary, Ed Miliband, said: “A year after the government promised full compensation for those facing the scandal of forced prepayment meter installations, which saw widespread self-disconnection and vulnerable people left without heating during the cold winter months, they have utterly failed to carry through on their promise.

“It is appalling that so few people have been given compensation, that suppliers were allowed to mark their own homework and to decide what redress to offer. This is a government that allowed the prepayment meter scandal to occur under its noses and has now added insult to injury by failing consumers once again.

“This is a government that simply cannot be trusted to stand up for the British people.”

In February 2023, the then business and energy secretary, Grant Shapps, told energy bosses to report back to him on what remedial action they planned to take if they had wrongfully installed prepayment meters in the homes of vulnerable customers.

British Gas is not included in the MCR, nor the figures disclosed by the regulator, because it is subject to a separate investigation after it emerged last year that agents working on its behalf had ignored customers’ vulnerabilities when installing meters.

Ofgem said energy suppliers had also compensated customers in various ways, including by adding credit to customers’ accounts and writing off debt.

The regulator, which will publish another update on the MCR by the end of June, said: “This review is continuing, and over 150,000 involuntary prepayment meter installations have been assessed by suppliers so far. Suppliers have used a range of ways to find affected customers, including looking at customer accounts with known vulnerabilities or where complaints have been made.

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“Suppliers have also contacted all prepayment meter customers to ensure this method of payment remains appropriate. Compensation levels may vary based on consumer’s individual circumstances and the harm they experienced.”

In January, EDF, Octopus and Scottish Power were given the green light by the energy watchdog to install prepayment meters under warrant.

The three suppliers have to meet a series of requirements before forcibly installing the meters, including making 10 attempts to contact a customer and providing £30 of credit.


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