Ofgem has suspended forced prepayment meter installations and opened an industry-wide investigation into the rapid growth in such installations, Consumer Scotland said on 3 February 2023. The regulator acted after a Times investigation into British Gas prepayment meter installations for debt collection1.
Consumer Scotland, the independent statutory body for consumers in Scotland, said the suspension gives government, the regulator and industry breathing space while more effective protections are put in place for people who prepay for energy1. The body also welcomed Ofgem's plans, announced before the Times investigation, for a detailed assessment of prepayment meter installation covering self-disconnections, remote switching and forced installations, and for a prepayment market compliance review1.
"The suspension of forced prepayment meter installation is very welcome"
Ofgem warned all suppliers that it is unacceptable to impose forced installations on customers struggling to pay their bills before all other options have been exhausted and without thorough checks that it is safe and practicable to do so1. Consumer Scotland said it supported Ofgem's commitment to increasing the frequency of prepayment switching metrics, having previously highlighted a data gap on remote and legacy prepayment switches1.
The body said Scotland has a disproportionate number of households on prepayment meters, many likely to be living in fuel poverty, and that 421,000 households in Scotland already use prepayment meters1. Its Energy Affordability Tracker found affordability challenges including struggling financially, difficulty keeping up with energy bills and cutting back on food1. Findings from the next tracker were due for release soon, with initial analysis suggesting a continuing disproportionate impact on prepayment meter users1.
| Measure | Status as reported |
|---|---|
| Forced prepayment installations | Suspended1 |
| Industry-wide investigation into installation growth | Announced1 |
| Detailed assessment of installations | Planned, covering self-disconnections, remote switching, forced installations1 |
| Prepayment market compliance review | Planned1 |
| Increased frequency of switching metrics | Committed to1 |
Why it matters for households
For a household already on a prepayment meter, the suspension does not change how the meter works or what energy costs. What it changes is the route onto one: suppliers have been told that forcing installation on customers in debt, before other options are exhausted and without safety and practicality checks, is unacceptable1. Consumer Scotland said the precautionary principle should apply to switching consumers to prepayment meters, and that suppliers' primary consideration should be their duty of care to customers while reviews continue1.
For households not yet on a prepayment meter, the practical effect is that involuntary installation is paused while the regulator examines how remote switching and self-disconnection are monitored. Consumer Scotland said the 421,000 households already prepaying in Scotland need existing protections proactively enforced and sufficient financial support to stay connected to heat and power1. The rules on forced prepayment meter installation and the moratorium on involuntary installations set out where a household stands, and vulnerable customer protections cover the checks suppliers must make. For those already prepaying, emergency credit and supplier conduct on prepayment and debt are the relevant areas.
What happens next
Consumer Scotland said the findings from its next Energy Affordability Tracker would be released soon, showing the impact of the winter period on consumers' ability to manage financially, afford their energy bills and on their wider health and wellbeing1. Ofgem's investigation, assessment and compliance review were announced but no completion dates are given in the material published by Consumer Scotland1.