NEA welcomes energy regulator’s commitment to strengthen protections for pre-payment meter customers

25 June 2015

The fuel poverty charity National Energy Action (NEA) has today welcomed a new report published by the energy regulator, Ofgem, which has explored how to strengthen protections for pre-payment meter (PPM) customers.

The regulator will now seek views on ending charges for installing and removing PPMs and ending the use of security deposits. The report has also found that despite there being substantial savings available for PPM customers to switch to the cheapest direct debit (DD) tariff, the proportion of PPM customers that have never switched remains higher than DD customers.

Jenny Saunders OBE, Chief Executive of NEA comments:

The report is a timely reminder of the many options there are for reducing the inequalities that pre-payment meter customers still face. The report rightly highlights the need for pre-payment customers to be able to benefit from the substantial savings available for switching to the cheapest direct debit tariff and removing any barriers preventing this becoming the norm once debt is repaid. Whilst some suppliers have already chosen not to charge for installs, removals, warrant related costs or security deposits, we also welcome a commitment to look to end these charges for all customers.

The regulator also notes concerns about a reported increase in forced installs by some suppliers. The charges for these are often high and applied to a customer’s account when more often than not these accounts are already heavily in debt. This can have a very negative effect upon the lifetime of any debt and in some instances can be more than the original debt owed by the customer. We continue to be concerned about the appropriateness of these charges and will work with regulator to ensure suppliers reduce the charges some customers face from paying for these costs”.

ENDS

NOTES TO THE EDITOR

  1. Ofgem has today published a report entitled “Prepayment review: understanding supplier charging practices and barriers to switching” to read the full report, please click here.
  2. For more information about National Energy Action (NEA) please visit www.nea.org.uk.
  3. For all media enquires please contact peter.smith@nea.org.uk or call 07595780893.
  4. Fuel debt, currently as high as £950m, means that money that could be spent by low income consumers in local economies is spent instead on servicing increasing levels of debt. As well as appropriate payment methods, tariffs and energy advice, NEA is pressing the UK Government to adequately resource initiatives that make homes warmer and healthier and in turn encourage economic growth.
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