All British energy suppliers have now signed up to Ofgem’s new, stricter regulations around involuntary installations of prepayment meters (PPM). The new code, which was developed in consultation with the likes of Citizens Advice and Energy UK, will see forced instalments banned in the homes of customers over 85 and more chances given to hard-up customers to pay their debts.
The move comes following an investigation that found debt collectors were forcing their way into homes to install prepayment meters.
Under the new rules, suppliers and contractors must make at least 10 attempts to contact a customer and carry out a “site welfare visit” before a PPM is installed.
They must also “refrain from all involuntary installations” for the highest-risk customers, including people over the age of 85; households with severe health issues that depend on energy for medical equipment or the need for a warm home, as well as those that don’t have the ability to top up the meter due to a physical or mental incapacity.
In the instance that someone is forced onto a PPM, they will now be given £30 credit to reduce the risk of them losing supply.
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Suppliers must also offer customers assessments to see if a PPM remains the most suitable option for them, and if so, offer the opportunity to return to their previous tariff.
Jonathan Brearley, CEO of Ofgem, said: “Ofgem’s new voluntary Code of Practice is a minimum standard that clearly sets out steps all suppliers must take before moving to a PPM.
“If and when involuntary PPMs are used, it must be as a last resort, and customers in vulnerable situations will be given the extra care and consideration they deserve, over and above the rules already in place, by suppliers – something that has clearly not always been happening.
“This new Code of Practice means, for some people, PPMs should never be installed, and, for high-risk groups, their energy needs must be protected with a higher level of consideration. The Code requires suppliers to become more attuned to the needs of all their customers in vulnerable situations, including if their circumstances change and reassess if or when they do, and apply better compassion and professional expertise.”
Commenting on the new rules, Myron Jobson, senior personal finance analyst at interactive investor, said: “Tackling the cost of living crisis has been an uphill struggle for many, and having a prepayment meter forcibly installed has added insult to injury to the most vulnerable members of society.
“Households with prepaid meters usually pay more for their energy, which served to intensify the heat or heat dilemma for the most vulnerable prepayment customers over the winter months. The new rules announced by Ofgem are welcome and will go a long way in protecting customers in vulnerable situations as the cost of living storm rages on.
“Those already on pre-payment meters are set to benefit from parity between the cost direct debit customers are charged for energy and that which households on pay-as-you-go meters are made to pay from July, marking the end of the prepayment premium.”
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He said: “There are really vulnerable groups which have been omitted from its full protection and we have serious concerns about how it will be implemented, such as how people will prove their medical conditions without being humiliated by an energy firm health inspection.”
Disability equality charity Scope is also among the groups calling for tighter restrictions. Tom Marsland, the charity’s policy manager, said: “This is a welcome step forward from Ofgem. It will now be clearer when the rules are broken, and remote switching will be included. But this process will still allow energy companies to install prepayment meters in some disabled households.
“We want to see the forced installation of meters and remote switching banned outright for disabled people.”