Prepayment meter customers no longer face the highest energy costs

Prepayment meter customers have no longer faced the highest energy costs since July 2023, according to a report published by Ofgem in July 2025 on what drives consumer satisfaction with energy suppliers¹. The report, which applies regression analysis to more than 15,000 survey responses collected across four waves between August 2023 and January 2025, also records overall supplier satisfaction reaching 81% in January 2025, the highest level since Citizens Advice and Ofgem began tracking it in late 2018¹.

The finding on prepayment costs sits within a wider picture of recovering satisfaction. Since a low in March 2022, during the peak of the energy crisis, satisfaction has risen by 15 points, while the share of respondents saying they were neither satisfied nor dissatisfied fell from 21% in March 2022 to 13% in January 2025, and dissatisfaction fell from a peak of 13% to 6% in January 2024¹. Satisfaction averaged 75% across the last four waves¹.

On payment type, the report states that prepayment customers show higher satisfaction than those on direct debit once other variables are controlled for, while standard credit payers are the least likely to be satisfied¹. Payment type carries minimal weight in the model overall¹. The report notes that this pattern differs from what descriptive analysis had suggested until now¹.

Financial circumstances were the most influential factor in the demographic and energy characteristics model, accounting for 32% of the variance that model explains, or 3.7% in absolute terms¹. The report estimates that perceived improvements in household finances account for 1.3 percentage points, or just over one tenth, of the rise in satisfaction from 69% to 81%¹. It concludes that improved household finances played a role, but that most of the rise likely reflects supplier performance and other unobservable factors¹.

"Since July 2023, prepayment meter (PPM) customers have no longer faced the highest energy costs."

The report also finds that ease of contacting a supplier and bill satisfaction were joint top predictors of overall satisfaction in the customer service model, with relative importance scores of 35% and 34% respectively¹. Customers with smart meters tended to report higher satisfaction than those without, and switching was associated with higher satisfaction, particularly among those who switched while staying with the same supplier¹.

Why it matters for households

For a household on a prepayment and pay as you go tariff, the report's finding marks a change in the long-standing position that prepayment was the most expensive way to pay. The comparison between prepayment and direct debit under the price cap has been a central question for households weighing up how they pay, and the report indicates that since July 2023 prepayment customers have not carried the highest costs. The report does not set out the size of any gap between payment methods, and no figure for the difference is given¹.

The satisfaction findings matter less directly to a household's energy independence than to how it deals with its supplier. The report links satisfaction to ease of contact and billing, and notes that a poor smart meter experience can harm satisfaction more than not having one at all¹. For households managing energy debt through a prepayment meter, the rules governing prepayment meters and vulnerable customers remain the relevant framework, and the report does not address them¹.

What happens next

The report gives no dated next steps. It records that the Energy Supplier Customer Satisfaction Survey is run by BMG for Ofgem and Citizens Advice, that wave 20 was completed in January 2025, and that a survey question on electric vehicle ownership was introduced in January 2025¹. No further publication date is stated¹.

Sources1 cited

1. What drives consumer satisfaction with energy suppliers, ofgem.gov.uk