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Energy firms targeted 100,000 customers with prepayment meters before crackdown

woman swipes prepayment meter card
woman swipes prepayment meter card

Energy firms including British Gas used court orders to force costly prepayment meters in 7,500 homes every month, before a crackdown on the controversial practice this year.

Data from the Department of Business, Energy and Industrial Strategy found more than 94,000 prepayment meters were installed under warrant in 2022.

Three providers – British Gas, Scottish Power, and Ovo Energy – made up 70pc of all prepayment meters force-fitted, the data showed.

Scottish Power was the worst offender taking into account its customer base, fitting more than 24,300 meters.

Prior to the clampdown this year, prepayment meter customers were charged higher rates for energy usage than those paying by direct debit. Households on prepayment meters risk having their energy supply cut off entirely, as they cannot use energy if they cannot top up.

Energy Secretary Grant Shapps said the figures gave “a clear and horrifying picture of just how widespread the forced installation of prepayment meters had become”.

He added: “I do have concerns that companies have not been treating their customers fairly, over an already difficult winter during which the Government has tried to help families by paying around half the energy bill of the average household.”

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In February it emerged that British Gas had used court warrants to break into the home of vulnerable customers to forcibly install prepayment meters. Earlier this month, Chris O’Shea, chief executive of British Gas owner Centrica, was grilled by MPs over the allegations of forced installations. 

The Beis Select Committee raised with Mr O’Shea cases in which a woman with mental distress and a partially sighted woman with arthritis were visited by debt collectors, although Mr O’Shea claimed “not to have details” of either case.

Mr O’Shea said he was waiting on the outcome of an internal investigation by British Gas to determine whether the providers’ issues were “isolated or systemic.”

Suppliers agreed to stop forcibly installing prepayment meters under warrant in February and remain under pressure to compensate families whose homes were broken into.

A Scottish Power spokesman said the provider would not switch a customer to prepayment without advanced notice, adding that it was "always a last resort." The firm is currently not installing prepayment meters or recovering debt from those customers on new pre-payment meters, "unless requested by the customer and is focused purely on charging for usage", they added.

British Gas and OVO Energy were approached for comment.