Money Wellness
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calendar icon04 Apr 2024

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

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

This comes after 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, cutting them off from heating in winter. Ofgem has now banned energy companies from doing this.

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.

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.

But the initial information gathered by Ofgem from energy suppliers only showed that 1,502 customers had had compensation totalling £342,450.

What’s dubbed as a scandal of forced prepayment meter installations saw widespread disconnection from energy suppliers and vulnerable people left without heating during the winter months.

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

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

Avatar of Lydia Bell-Jones

Lydia Bell-Jones

With a background in banking, Lydia has been writing professionally for over five years. She is passionate about helping people improve their personal finances and has a particular interest in the connection between money and mental health.

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