Christmas prepayment compulsion ban period begins

Electricity and gas suppliers have committed not to compel customers in debt to move onto a prepayment meter between 16 December 2022 and 20 January 2023, unless the customer specifically requests it¹. The commitment forms part of a Consumer Energy Charter developed by the Consumer Council with the Utility Regulator, the Department for Communities, the Department for the Economy and the gas and electricity suppliers¹. Suppliers signed up voluntarily¹.

The charter also covers debt repayment rates. From 1 December 2022, suppliers will reduce the amount deducted from a prepayment meter top-up to repay debt from a maximum of 40 per cent to 20 per cent, and will carry out a bespoke assessment of the customer's ability to pay¹. Under the Utility Regulator's existing Code of Practice, a supplier can deduct up to 40 per cent from a purchase of electricity or gas to reduce debt; halving that figure means at least 80 per cent of any new payment goes towards additional supplies¹.

"Electricity and gas suppliers will not compel customers in debt to move onto a prepayment meter over the Christmas period (16 December 2022 to 20 January 2023), unless specifically requested by the customer."

Other commitments include that customers on a supplier's customer care register are not moved onto a prepayment meter unless they request it, that debt collection processes, including those carried out by agents, follow the Utility Regulator's Code of Practice for Payment of Bills, and that suppliers contact those on their care registers to inform them of the best available tariffs¹. Each supplier is required to maintain a customer care register holding details of consumers who merit special treatment on account of age, disability or chronic illness; consumers have to choose to join it¹.

Suppliers have also committed to making a financial contribution to a hardship fund, with amounts at each supplier's discretion and paid either to a fund, to a charity of the supplier's choosing, or to in-house funds¹. The charter's protections extend to all households, but the Consumer Council says customers in debt, or vulnerable because of age, disability or chronic illness, are more likely to use them¹.

Why it matters for households

For a household already in debt, the difference between a 40 per cent and a 20 per cent deduction is the share of each top-up that becomes energy rather than repayment. At the lower rate, at least 80 per cent of a payment buys gas or electricity¹. The Christmas window removes, for a set period, the prospect of being moved onto a prepayment meter without asking, which for a household that cannot top up regularly would mean the risk of running out of supply. The care register commitment goes further for those who qualify, since it applies beyond the Christmas dates¹. The charter is voluntary, and the Consumer Council states that making it mandatory would have required supplier licence changes following lengthy consultation¹. The Utility Regulator will monitor suppliers' behaviour to check they honour the commitments¹. The charter does not change the underlying debt; it changes the rate at which it is recovered and the payment method a supplier can impose.

What happens next

The compulsion ban runs to 20 January 2023¹. Advice NI states that signatories will use best endeavours to implement the commitments as soon as they can and adhere to them to 31 March 2023². The Consumer Council says it will continue to monitor the situation and, should the protections need to continue, will discuss further options with suppliers¹.

Sources2 cited

1. Customer energy charter | Consumer Council, consumercouncil.org.uk
2. Consumer Energy Charter | Advice NI, adviceni.net