Energy groups told to submit support plans for prepayment meter victims

Grant Shapps has called on energy bosses to spell out what remedial action they are taking to deal with customers who wrongly had prepayment meters forcibly installed in their homes, warning that the regulator risked having the wool pulled over its eyes by suppliers.

Energy regulator Ofgem last week ordered suppliers to suspend the practice of forcibly installing the meters, following a report in the Times newspaper.

An undercover investigation by the paper found that British Gas third-party contractor Arvato Financial Solutions was installing the meters in the homes of vulnerable customers.

The business secretary has called on energy suppliers to report to his department by Tuesday, outlining their plans to support affected customers through measures such as compensation.

Shapps has also urged Ofgem to establish a new reporting system to allowing customers to record their experience of dealing with the energy companies and called on the regulator to strengthen its reviewing structures.

Ofgem had awarded British Gas the top ranking in two reviews carried out in the second half of last year, which assessed how suppliers were dealing with customers who were deemed vulnerable or who were struggling to pay their energy bills

“I am appalled that vulnerable customers struggling with their energy bills have had their homes invaded and prepayment meters installed when there is a clear duty on suppliers to provide them with support,” the business secretary said. “They need to refocus their efforts on their consumers, the British public, who are at the receiving end of this abhorrent behaviour.

“I’m also concerned the regulator is too easily having the wool pulled over their eyes by taking at face value what energy companies are telling them. They need to also listen to customers to make sure this treatment of vulnerable consumers doesn’t happen again.”

Consumer groups have in recent months warned of a rising number of suppliers imposing expensive prepayment meters on customers who have fallen into arrears. Consumer organisations such as Citizens Advice have called for a ban on the practice until new protections for customers have been introduced.

Ofgem has launched what it called a major marketwide review of prepayment meter installations that will look into potential breaches of licences driving the growth.

Earlier this week, Jonathan Brearley, Ofgem’s chief executive, said that he had asked suppliers to review the use of court warrants. “Suppliers need to reassure us that the processes for customers being moved on to PPMs are compliant with all Ofgem rules and, until this is done, we have asked them to pause forced installations,” he said.

Chris O’Shea, chief executive of British Gas owner Centrica, has said that the company would suspend the practice and apologised for what it described as “deeply disturbing” allegations.

Additional reporting by Nathalie Thomas.