Hard-up households get £230 compensation over prepayment meter scandal – with thousands more due cash
HARD-UP households have received £230 compensation following the prepayment meter scandal.
Industry regulator Ofgem has also announced at least a thousand more are due cash.
It comes over a year after a Times investigation which revealed that British Gas sent Arvato debt collection agents to “break into” people’s homes and “force-fit” prepayment meters (PPMs).
Suppliers can fit these meters as a last resort to collect debt from customers who are behind on their bills.
But a new code of practice governing the installation of prepayment meters, which all energy companies signed up to last April, was put in place after the investigation.
Even though all firms signed up, they are still barred from forcibly fitting PPMs until Ofgem signs off that they are compliant with the legal changes.
Ofgem announced a Market Compliance Review (MCR) into involuntary prepayment meter practices last year.
It told companies to review cases of people who were forced onto the meters between the start of 2022 and the end of January 2023.
As a result, energy suppliers have paid compensation totalling £342,450 to customers who were wrongly put onto the meters.
A total of 1,502 people have now received payouts, averaging at £228 each.
Although it’s important to bear in mind the amounts paid to customers vary across different suppliers.
Compensation levels may also vary depending on the consumer’s individual circumstances and the harm they experienced.
Energy firms have also compensated customers in various ways, including sending cheques, adding credit to the customer’s account, and writing off debt that customers had built up.
Suppliers are planning more payments of around £200,000 for 1,000 more customers, Ofgem said.
British Gas is not included in the MCR or the compensation figures, as it is subject to a separate investigation.
Ofgem 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.”
It added that suppliers have also contacted all prepayment meter customers to ensure the payment method remains appropriate.
The next update on the review and payout will be published by the end of June.
It will include figures on the number of customers who have had compensation and the amount paid.
Sun Money called for a ban on moving households onto prepayment meters back in August 2022.
How you can claim compensation
Ofgem says if a customer thinks their supplier installed a prepayment meter or switched their smart meter to prepayment meter mode when they should not have, they may be entitled to compensation.
They should contact their energy firm, explain their circumstances, and make a complaint.
If you’re looking to make a complaint there are organisations who can help.
Consumers can contact Citizens Advice and Advice Direct Scotland.
If customers need extra support, the complaint may be referred to Extra Help Unit and Energy Ombudsman.
Ofgem also said it is working with each agency to ensure that they are taking a joined-up approach to ease stress for consumers.
What to do if you can't pay your bills
FALLING behind on your energy bills can be extremely stressful.
If you’re struggling to pay what you owe, contact your supplier as soon as possible.
Your provider has to help you come up with a solution, and you should be able to negotiate a deal that works for you both.
One option is to agree a payment plan where you pay off your debts in affordable instalments.
You may be able to pay off your debts directly from your benefits through the Fuel Direct Scheme.
A fixed amount will automatically be taken to cover what you owe plus your usage.
To be eligible, you must be getting one of the following benefits:
- Income-based jobseeker’s allowance
- Income support
- income-related employment and support allowance
- Pension credit
- Universal Credit (but only if you’re not working)
If you cannot come to an agreement with your supplier, they may try to force you to get a prepayment meter installed.
In very rare cases, where you refuse to negotiate, your supplier might threaten you with disconnection.
Which suppliers have been allowed to forcibly fit prepayment meters?
Since the ban on forcibly fitting prepayment meters, several suppliers have since been given permission to resume the practice.
Most recently, E.On and Tru Energy were given permission to return to forcibly fitting prepayment meters in February.
Ofgem said the two firms had met its “strict” conditions, which include conducting internal audits to identify PPMs wrongfully installed before the February 2023 moratorium and offering compensation and a return to a non-prepayment payment method to any affected customers.
They follow EDF, Octopus and Scottish Power, who were granted the same permissions in January.
Once suppliers meet the conditions and restart “involuntary” installations, they must also provide regular monitoring data to Ofgem to identify any concerning practices.
The firms must still make at least 10 attempts to contact a customer before a prepayment meter is installed and carry out a site welfare visit before proceeding.
They are not allowed to forcibly fit a meter if the household is considered to include “highest risk” customers.
This includes those which require a continuous energy supply for health reasons, have an older occupant aged 75 and over without support, or those with children under two years old.
Customers and consumer groups can check the energy suppliers that can install prepayment meters without a household’s permission on the Ofgem website.
Steps you can take if you’re struggling to pay for your energy
You can take some measures if you’re struggling to pay for your energy.
If you fall into debt, you can always approach your supplier to see if they can put you on a repayment plan before putting you on a prepayment meter.
This involves paying off what you owe in installments over a set period of time.
If your supplier offers you a repayment plan you don’t think you can afford, speak to them again to see if you can negotiate a better deal.
Beyond this, several suppliers offer customers grants if they’re struggling to pay energy bills.
A grant is a sum of money you don’t have to pay back, so it’s essentially free cash.
British Gas, Scottish Power, Ovo Energy, E.On, E.On Next, EDF, Octopus Energy and Shell Energy offer grants.
Plus, thousands of vulnerable households are missing out on extra help and protections by not signing up to the Priority Services Register (PSR).
The service helps support vulnerable households, such as those who are elderly or ill, and some of the perks include being given advance warning of blackouts, free gas safety checks and extra support if you’re struggling.
Not everyone is eligible for the Priority Services Register. Your energy firm must deem you to be vulnerable.
This could apply to you if you:
- Have reached state pension age
- You are disabled or have a long-term medical condition
- You are recovering from an injury
- Have a hearing or sight condition
- Have a mental health condition
- You are pregnant or have young children
- You need to use medical equipment that requires a power supply
There could be other situations where you’re eligible too, like if you need short-term support after a hospital stay.
For full details on eligibility, visit Ofgem’s website.
Get in touch with your energy firm to see if you can apply.
Meanwhile, millions of customers have just days left to submit meter readings as major energy suppliers extend deadlines.
Plus, an energy supplier has extended a “no-brainer” initiative offering millions of customers half-price energy.
Do you have a money problem that needs sorting? Get in touch by emailing squeezeteam@thesun.co.uk.
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