Ofgem's strengthened rules governing the involuntary installation of prepayment meters (PPMs) came into force in November 2023, the regulator has confirmed in a market compliance review published on 3 June 20261. The rules followed a Market Compliance Review (MCR) opened in January 2023 into involuntary PPM practices across domestic energy suppliers, after media allegations and preliminary investigations opened towards the end of 20221. All suppliers had agreed to stop involuntary installations and remote switches while the rules were reviewed and strengthened1.
Under the strengthened framework, suppliers had to demonstrate that they met the new requirements before restarting any involuntary PPM activity, supported by a second independent audit verifying their readiness to restart1. The first suppliers restarted involuntary PPM activity in January 20241. Ofgem states that all suppliers can now carry out involuntary PPM activity, although not all have chosen to do so1. British Gas has never been part of the PPM MCR, having been subject to a separate enforcement investigation, and does not currently carry out involuntary PPM activity1.
The review found that involuntary PPMs were installed when it was not safe and reasonably practicable in less than 2% of the customer accounts reviewed, which Ofgem puts at 1,925 instances out of more than 150,000 accounts1. Ofgem said the review did not uncover widespread instances of inappropriate PPM installations, but that some suppliers' policies and procedures were not as robust as they should have been1. Most cases where a PPM should not have been installed were due to poor quality assurance or human error, for example where agents did not act in line with suppliers' procedures and insufficient controls were in place to prevent this1.
Suppliers have paid £7 million in compensation, written off £13 million in customer debt, and provided £55 million in support through hardship payments and debt relief1. Ofgem's compensation guidelines set out the following levels by type of detriment1:
| Detriment | Compensation level |
|---|---|
| Process misalignment, data quality and record keeping | Goodwill payments of £40 to £60 paid by supplier on a case-by-case basis |
| Insufficient debt support | £250 |
| Unfair customer treatment | £250 |
| Vulnerability not considered | £500 |
| Inappropriate installation, switch or use of PPM | £1000 |
Ofgem's update on the PPM MCR published in May 2025 confirmed that suppliers would pay £5.6 million in compensation1. The review also states that suppliers were required to assess every customer with a PPM to confirm if it was safe and reasonably practicable, and must now complete an assessment annually1. Involuntary PPM activity carried out by a supplier was reported to Ofgem on a weekly basis, with information on a sample of accounts, including system notes, communication attempts and bodycam or audio footage from site visits and calls, submitted and reviewed for compliance1.
"Our strengthened rules came into force in November 20232."
Why it matters for households
The rules set the conditions under which a supplier can move a household onto a prepayment meter without the customer's agreement, and the strengthened version requires an assessment of whether a PPM is safe and reasonably practicable before any involuntary installation or remote switch, repeated annually1. For a household, that assessment covers circumstances such as mobility issues that prevent access to a top-up location, which Ofgem gives as an example of a situation where a PPM would be considered unsafe1. The rules sit alongside the wider framework covering prepayment meters and vulnerable customer protections and supplier conduct on prepayment meters and customer debt. Smart meters, including smart PPMs, fall under separate smart meter rules and supplier obligations. For a household's energy independence, the practical effect is that the decision to install a PPM involuntarily is now subject to a documented assessment and audit trail, and the compensation levels above apply where standards were not met1.
What happens next
Ofgem opened an enforcement investigation into Utilita's compliance with the rules around the installation and use of prepayment meters for domestic customers in November 2024, and in May 2025 an ongoing enforcement investigation into OVO's prepayment meter practices was extended to include the PPM MCR; the assessment of both suppliers was moved out of the MCR as a result1. Ofgem states that any customer who was involuntarily switched or had a PPM fitted and believes they should have been contacted by their supplier but has not been should contact their supplier, and can refer an unresolved complaint to the Energy Ombudsman1. Details of how complaints and redress work are set out in energy complaints and redress.
Sources1 cited
- Market compliance review: prepayment meter installations, ofgem.gov.uk