Energy suppliers across the UK have expressed concerns on the levels of customer debt being accumulated because of the halt to warrant prepayment meter installations.
Should this debt not be recovered, then energy suppliers believe this will increase costs and thus provide further strain. Ofgem confirmed it is investigating this issue and will assess costs to suppliers from customer debt.
Once the information has been processed by the energy regulator, it will determine what action is required, assuring suppliers it would “act quickly” on the matter.
Amid allegations from the Secretary of State for the Department for Energy Security and Net Zero Grant Shapps on energy suppliers forcefully installing pre-payment meters in vulnerable households – something that should be a last resort – suppliers agreed to halt further installations.
This would allow a thorough investigation into the issue and explore what measures could be introduced to prevent further issues surrounding prepayment installations.
Prepayment meters installations had risen considerably amid the energy crisis. But due to soaring energy prices, many on prepayment meters have been unable to pay for energy and thus had their supply cut off.
Ofgem confirmed it would look into the issue surrounding the technology and sent letters to detail what the energy regulator is planning to do to rectify the issue.
For this, energy suppliers have sent internal review responses to Ofgem to support the investigation. This is being conducted as part of the Market Compliance Review.
The details of this investigation will be released on 21 February and will also detail various timelines on prepayment meter warrant installations and remote mode switching.
After this, Ofgem will conduct an intensive consultation process which will bring together energy suppliers, consumer groups and charities to consider how the rules and guidance on the use of prepayment meters by suppliers apply to the current exceptional circumstances. This will be completed by 31 March 2023.
