Energy groups 'obliged' to help customers in debt, says Ofgem
UK's energy regulator has told energy companies they are “obliged” to help consumers who are in debt.
On Tuesday, Ofgem said it would launch a probe into the installation of pre-pay meters, insisting they should be utilised as a last resort.
The regulator would be “looking into reasons behind the increase in the number of pre-pay meters installed for non-payment of debt on a warrant visit,” a spokesman said.
"Suppliers can only install a pre-payment meter where it is safe and reasonably practical for the consumer to use.”
According to figures obtained by Ofgem in response to a Freedom of Information request, approximately 97,000 pre-pay gas and electricity meters were installed in the UK in 2014, compared with 63,000 in 2009.
Energy suppliers can obtain a court order to install pre-pay meters when customers run up debt, although Citizens Advice said pre-pay customers could end up spending on average £80 a year more than direct debit customers.
"Pre-payment meter customers can't take advantage of the competitive energy market," Audrey Gallacher of Citizens Advice, who described the figures as “concerning”, was quoted as saying by the BBC.
"Many people become trapped on them and can't get a better deal."
However, Energy UK, the umbrella organisation for energy suppliers, stressed that suppliers only installed pre-pay meters "as a last resort to help customers manage their debt".
"As an industry, we're doing more every day to try and improve that and to bring in different options for customers in those circumstances," chief executive Lawrence Slade told the BBC Radio 4’s Today programme.
"People will often ask for a pre-payment meter voluntarily because they like the fact it gives them more control over their consumption."