Me­ter charges capped for in-debt fam­i­lies

● Ofgem brings in £150 limit for en­ergy cus­tomers who owe hun­dreds

The Scotsman - - News Digest - By JANE BRADLEY Con­sumer Af­fairs Cor­re­spon­dent

Cus­tomers who are in debt to their en­ergy sup­plier will no longer be slapped with hun­dreds of pounds worth of charges for the in­stal­la­tion of pre­pay­ment me­ters un­der new in­dus­try reg­u­la­tions an­nounced to­day.

Ofgem has an­nounced a £150 cap on charges for in­stalling pre-pay­ment me­ters un­der war­rant for cus­tomers who have racked up un­paid bills and has banned all charges for the most vul­ner­a­ble.

Un­der cur­rent rules, en­ergy sup­pli­ers can ap­ply to the court to in­stall a me­ter un­der war­rant when cus­tomers are con­sis­tently un­able to pay out­stand­ing gas or elec­tric­ity bills - and charge the cost to the house­holder. Th­ese charges, which can in­clude court costs, are on av­er­age £400 for a dual fuel cus­tomer but can range up to £900 - and risk push­ing vul­ner­a­ble cus­tomers fur­ther into debt.

As well as the cap, th­ese mea­sures pro­hibit sup­pli­ers levy­ing any pre­pay­ment me­ter war­rant charges and ban­ning th­ese in­stal­la­tions en­tirely, for the most vul­ner­a­ble cus­tomers. This in­cludes pro­hibit­ing charges for peo­ple in se­vere fi­nan­cial dif­fi­culty, and ban­ning in­stal­la­tions en­tirely for peo­ple for whom the ex­pe­ri­ence would be se­verely trau­matic, such as those suf­fer­ing with men­tal health is­sues.

Rachel Fletcher, Ofgem’s se­nior part­ner for con­sumers and com­pe­ti­tion, said: “At the mo­ment vul­ner­a­ble cus­tomers face a dou­ble blow when they’re hit with high war­rant charges on top of ex­ist­ing debt – risk­ing mak­ing their sit­u­a­tions worse.

“The mea­sures will pro­tect all con­sumers, in­clud­ing the most vul­ner­a­ble, from ex­pe­ri­enc­ing un­nec­es­sary hard­ship due to hav­ing a me­ter in­stalled un­der war­rant. We want to send a strong mes­sage to sup­pli­ers that us­ing a war­rant to in­stall a pre-pay­ment me­ter is a last re­sort. They must step in early to help cus­tomers man­age debt through re­pay­ment plans.”

Craig Sal­ter, from Cit­i­zens Ad­vice Scot­land’s Con­sumer Fu­tures Unit, said: “Th­ese charges make it harder for cus­tomers who are al­ready strug­gling to man­age their debts.

“So, while this an­nounce­ment is cer­tainly a step in the right di­rec­tion, we would also want to stress that im­pos­ing th­ese kind of charges at all should al­ways be a last re­sort, and en­ergy com­pa­nies should seek to help make sure con­sumers don’t fall into ar­rears in the first place.”

Lawrence Slade, chief ex­ec­u­tive of in­dus­try body En­ergy UK, said: “In­stalling a pre­pay­ment me­ter un­der war­rant is a last re­sort for sup­pli­ers and only done after ex­haust­ing other ef­forts to con­tact the cus­tomer.”

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