Ofgem has published guidance confirming that households moved onto a prepayment meter without their permission between 1 January 2022 and 21 January 2023 may be able to claim compensation if their supplier did not follow the rules properly1. The regulator's page sets out the conditions suppliers must meet before an involuntary prepayment installation, and the routes open to a household that believes those conditions were breached1.
Under the rules, a supplier can install a prepayment meter without permission only where the household is building up an energy debt and other ways of recovering that debt have not worked1. Before going ahead, the supplier must make reasonable efforts to agree another way for the debt to be repaid, make at least 10 attempts to contact the household using different methods such as phone calls, letters or text messages, and visit the home to check whether a prepayment meter is safe and suitable1. Ofgem states:
"Installing a prepayment meter without your permission should always be a last resort."
Before installation, the supplier should explain why it has made the decision, say when it plans to install the meter, explain what will happen during installation, and tell the household how to make contact if circumstances change or the decision is thought to be wrong1. The person visiting the home on the supplier's behalf should wear an audio recording device or body-worn camera1. Once the meter is installed, or an existing smart meter is remotely switched to prepayment mode, the supplier must give £30 credit1.
Ofgem lists circumstances in which a supplier must not install a prepayment meter at all, because vulnerable people are in the household1:
| Situation | Supplier must not install |
|---|---|
| Terminal illness or severe health condition in the home | Yes |
| Continuous supply needed for a medical condition or powered medical equipment | Yes |
| Everyone in the home is 75 or over with no one else able to provide support | Yes |
| A child aged under 2 lives in the home | Yes |
| No one can top up the meter because of a physical or mental health condition | Yes |
| Temporary circumstances such as pregnancy or bereavement make it unsafe or unsuitable | Yes |
A supplier can also seek a warrant to enter a property and install a prepayment meter, or remotely switch an existing smart meter to prepayment mode1. The rules governing these protections sit alongside the wider prepayment and vulnerable customer rules and the moratorium on involuntary installations.
Why it matters for households
A prepayment meter changes how a home pays for energy: credit is bought in advance, and supply can stop when the credit runs out. For a household that did not ask for one, that shift can remove the ability to spread costs across a billing period and puts the timing of payment under the household's direct control only in the sense that it must keep topping up. The compensation window matters because it covers a period when energy prices rose sharply and installations were carried out at scale, and it applies specifically where the supplier did not follow the procedural steps above. The £30 credit is separate from any compensation and is due on installation or remote switching1. Households that believe the rules were not followed can ask the supplier to explain its decision and what checks it carried out, and can complain; unresolved complaints can go to the Energy Ombudsman1. Ofgem directs households to Citizens Advice to find out whether compensation is owed1. The guidance does not state how much compensation may be payable, and no total number of affected households has been reported1.
What happens next
There is no closing date for claims in the guidance. Ofgem advises contacting the supplier as soon as possible if the rules are thought not to have been followed, and the Energy Ombudsman can be contacted if the complaint handling is unsatisfactory1.