Save, make, understand money

Household Bills

Compensation call for victims of forced prepayment meter installations

Paloma Kubiak
Written By:
Paloma Kubiak

The energy regulator has urged suppliers to check whether prepayment meters were installed correctly under its rules, and to offer compensation if they were fitted inappropriately.

Ofgem said suppliers should use the current pause in prepayment meter installations “to proactively check if any have been installed incorrectly”.  If so, they should “consider removing them and offering compensation where appropriate”.

The regulator said it will be checking the actions suppliers have taken and will take, adding that it will look at what further protections may be needed as part of prepayment meter (PPM) installation rules, regulations and guidance.

It will also look at other measures that could reduce the need for PPMs to be installed or switched to remotely, with this concluding by the end of March 2023.

PPM installations surged as prices rocketed

The move by Ofgem comes as PPM installations have surged amid soaring energy prices. While there are strict rules around the PPM installation process and who can be switched; in October 2022, Ofgem revealed households had been left in the dark for weeks after being remotely switched to the pricier tariffs without their permission.

As charities, organisations and MPs called for forced PPM installations to be banned to protect vulnerable customers from self-disconnection at the height of winter in January 2023, British Gas said it would stop remote switches via smart meter. Meanwhile, claims that court warrants for physical installations were agreed in minutes also made the headlines.

However, it took The Times expose with allegations that agents working on behalf of British Gas broke into the homes of vulnerable customers to fit PPM that really caught the attention of the regulator.

It launched an urgent investigation following the claims, temporarily banning the energy giant from doing any forced installation or remote mode switching. Further, it then asked all suppliers earlier this month to pause forced PPM installations, a move that wil remain in place for six weeks.

‘Prepayment meter installations should be a last resort’

Jonathan Brearley, CEO of Ofgem, said: “I am concerned about the way customers in already distressing situations are being treated when suppliers force them onto PPMs. That’s why, today, we have set out further details on the two investigations, one into British Gas for potential breaches that have been alleged indicating that something went very badly wrong at British Gas and the other into PPMs across all suppliers to assess whether this is an isolated case.

“The rules and regulations are clear that installing forced PPMs should only be done as a last resort and only where it is safe and practicable to do so. We expect suppliers to treat customers with compassion and professionalism and those executing a warrant should take into account what they find when they visit a home and pause the installation if they see a safety risk. Where this hasn’t happened, we will hold suppliers to account.”

Brearley added that suppliers shouldn’t wait for the outcome of its review to “act now to check that PPMs have been installed appropriately”.

“And if rules have been broken, offer customers a reversal of installations and compensation payments where appropriate. There will also be fines issued from Ofgem if the issue is found to be systemic.”

He said: “We are taking this issue extremely seriously and customers should feel reassured that where the rules have been broken, Ofgem will act.”