The moratorium on forced installations of prepayment meters (PPMs) was introduced for all domestic gas and electricity suppliers in February 2023 and was lifted from November 2023 for suppliers who met the restart criteria set out and assessed by Ofgem1. The account comes from Consumer Scotland, the statutory advocacy body for consumers in Scotland, in its response to the Energy Security and Net Zero Committee inquiry on fairness of customer energy bills, published on 21 February 20241.
In the interim period, Ofgem strengthened its Code of Practice for the involuntary installation of prepayment meters and made the Code part of suppliers' licence conditions1. Consumer Scotland welcomed the new Code of Practice while making a number of recommendations for where it could be strengthened1.
"It is critically important that the new Code of Practice is subject to rigorous ongoing monitoring, evaluation, and review of efficacy by Ofgem and suppliers, to ensure that it is fit for purpose and that it is improving consumer outcomes."
Consumer Scotland stated that it is too early to assess the impact of the new Code of Practice on supplier behaviours in relation to involuntary installation of PPMs, and on associated reforms to the support offered to consumers at risk from self-disconnection1. No assessment of the restart criteria themselves, or of how many suppliers met them, is given in the source.
The same response sets out Consumer Scotland's position on payment methods. It recognises that suppliers' billing costs are lower for consumers who pay by direct debit than for those who pay by other means, but argues these differences should be socialised across consumers, so that direct debit customers would not receive cheaper energy as a consequence of the payment method1. It cites analysis showing that consumers who pay by prepayment meter or standard credit are disproportionately more likely to be in vulnerable circumstances, have low income, and be in fuel poverty than direct debit consumers, and that switching to direct debit is often not an option available to many of them1.
Why it matters for households
The lifting of the moratorium means that, from November 2023, suppliers assessed by Ofgem as meeting the restart criteria can again install prepayment meters without a household's consent, under a Code of Practice that now forms part of their licence conditions. For a household, the practical position depends on which supplier it is with and on the protections in that Code, rather than on a blanket ban. The rules covering forced prepayment meter installations and the wider prepayment and vulnerable customer rules sit with Ofgem, which sets and assesses the criteria.
For a home's energy independence, the distinction is between choosing a prepayment meter and being moved onto one to recover debt. A prepayment meter requires credit to be added before energy is used, so a household that cannot top up can lose supply through self-disconnection, and debt is recovered through the meter itself, as set out on repaying energy debt through a prepayment meter. Consumer Scotland's evidence that prepayment and standard credit customers are more likely to be in vulnerable circumstances or fuel poverty indicates which households are most exposed to that change1.
What happens next
Consumer Scotland states that it is too early to assess the impact of the strengthened Code of Practice on supplier behaviour, and calls for rigorous ongoing monitoring, evaluation and review of its efficacy by Ofgem and suppliers1. No further dates or milestones are given in the source.