A five point plan that could stop energy companies from forcibly entering homes and installing prepayment meters when their customers fall into debt has been laid bare. Business Secretary Grant Shapps wrote to energy suppliers and industry regulator Ofgem on Sunday, laying out his proposal in an effort to crack down on the mistreatment of energy users by suppliers who are “clearly jumping the gun and moving at-risk customers onto prepayment meters before offering them the support they are entitled to”.
Business Secretary Grant Shapps’s plan is as follows:
- A call for suppliers to voluntarily stop the practice of forced prepayment switching as the answer to households struggling to pay bills and make greater effort to help the most vulnerable.
- Request of the release of supplier data on the number of warrant applications they have made to forcibly enter homes to install meters.
- Urgent publication of a list of supplier redemption rates for the Energy Bills Support Scheme vouchers – showing who is meeting their responsibilities and who needs to do more.
- The launch of a government public information campaign reminding and informing eligible consumers to redeem their Energy Bills Support Scheme vouchers and how to do so. This will be through both advertising and direct communication channels, targeting the most vulnerable and those most likely not to have redeemed vouchers.
- Coordination with Ofgem ensure they take a more robust approach to the protection of vulnerable customers and conduct a review to make sure suppliers are complying with rules.
Helen Lord, CEO of the Vulnerability Registration Service has welcomed the plan, but said energy companies and the Government can do much more to stop vulnerable Britons falling behind on energy payments, resulting in the forced installation of prepayment meters.
These are usually more expensive than direct debit payments and need to be topped up with credit for the energy to flow. If they are not, families can be left sitting in the dark in freezing cold temperatures.
But currently, hundreds of thousands of warrants are being issued. They allow energy firms to forcibly install expensive meters when the most vulnerable in society fall into debt. According to the Vulnerability Registration Service, vulnerable people are reportedly twice as likely to be moved onto prepayment meters.
An investigation by the i which surfaced last week revealed that only 72 out of a staggering 500,000 warrants to install the meters in homes by force were rejected by magistrates courts.
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‘This has happened far too late’
But according to Ms Lord, this has come far too late. She told Express.co.uk: “This has been going on for so many years at it has seemed to have been completely ignored. There is traction as a result of a crisis and it is frightening.
“We knew there was going to be an energy crisis and this has happened far too late. This needs to be acted upon and there needs to a lot of clarity. There are a huge amount of individuals that have pockets of responsibility for vulnerability and I don’t think many of them are empowered to make changes. That needs to be driven from the top. While the regulators are stating best practices, it is very wooly and there needs to be actual action and clarity about what needs to happen.
“The most important thing is to try to ensure that anybody in vulnerable circumstances is not pushed towards prepayment meters. The challenge is that energy companies don’t know who is vulnerable.”
“They have their priorities service register, but this isn’t shared between energy companies or the networks, and you register on it on an ad hoc basis if you know about it. But people aren’t necessarily equipped to go through that process.”
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She added that companies and the Government should work together to establish who is vulnerable to better inform them of the help available. Millions of discount vouchers sent out to homes with prepayment meters as part of the Government’s Energy Bill Support Scheme (EBSS) have gone lost or unclaimed.
Ms Lord said more could be done to inform people about how to access those £400 discounts, as one example, to stop them falling behind on energy payments.
She said: “We need to make sure people are fully targeted and fully encouraged to get the benefits they are entitled to and we don’t put enough energy into actually making sure that people receive that level of support.
“We need to educate people and make it easy to get discounts where they- are entitled, to get advice making energy savings. There are simple things out there that can go to support people, such as looking at tariffs, discounted payment schemes and doing something more proactive where those vulnerable people have been identified to target them and tell them what is available, rather than making the assumption that people will be in a fit state to do that themselves.
“Some people won’t pay, but there needs to be a little bit of redress and a bit of action but I am certain this is not the route to go down because you are pushing people into desperation when they are least equipped to deal with it.”
“Energy companies also need to come together and get a hand on working out who their customers are,” she continued. “Sharing data about vulnerable people has been discussed but…the energy companies are in fear of breaching data protection guidelines.
“It needs to come from the Government level to drive that data sharing. It is about knowing your customer, there hasn’t been enough onus on the companies to know exactly who their customers are.
While Ms Lord suggest that the best plan of action is to stop people falling into a situation where they cannot pay the bills and fall into debt with their suppliers, the End Fuel Poverty Coalition has called for the forced installation of prepayment meters to be banned altogether.
Simon Francis, co-ordinator of the End Fuel Poverty Coalition, said: “The Government’s cease and desist order to energy firms is a welcome move, but falls short of the full ban on the forced transfer of homes onto pre-payment meters which we need to protect the most vulnerable.
“We also need to ensure that this voluntary approach covers the millions of people on smart meters, who must never be switched onto pre-payment mode without their active, informed consent. Recent revelations about the role of the courts have also been left unanswered. We need a full investigation to get to the bottom of the scandal quickly and ensure that if mistakes have been made, that those responsible are held to account and those that suffered are compensated.”
Express.co.uk is approaching Ofgem and BEIS for comment.