A rising number of households are having their energy smart meters remotely switched to prepayment meters, the energy regulator has said. Energy firms use the technology to swap customers who are in debt for the more costly plan without needing a warrant. Ofgem said it had received reports of “vulnerable customers being left without power for days or even weeks”. Kelly, from South London, whose meter was switched, said: “I suddenly only had £3 on my electric until payday.”
‘I was told by text’
Kelly, who did not want us to use her last name, was a direct debit customer with EDF when price rises saw her bills more than double from £200 a month to more than £430. The mother-of-two, who works part-time and receives £320 Universal Credit per month, quickly found herself about £1,000 in debt. “I’ve been calling EDF on and off since January to sort it,” she said. “Then I got a letter saying they would change me on to prepayment.”
Kelly tried again to talk to her supplier and told the BBC that communication has been poor and notes on her case were not properly updated. Then, in October, she simply got a text telling her that she was now on a prepayment plan. “I suddenly only had £3 on my electricity until payday. I was so unhappy.” EDF told the BBC a switch to a prepayment meter was “the last resort” after extensive attempts to discuss support and agree on a resolution with the customer. A spokesperson added: “In this situation, moving a customer to pay-as-you-go will prevent them from continuing to accrue debt at an uncontrollable rate and prompt the customer to take control of their ongoing energy payments.”
‘Disconnection by the backdoor’
Citizens Advice told the BBC that so far in 2022 almost 500 people have been in contact in distress after being forcibly moved onto prepayment – a 158% increase in cases in 2021. Rosi Avis, who heads up the Manchester Branch, said remote switching is “disconnection by the backdoor”. “If customers are unaware that they are on a pre-payment meter they might not top up and therefore they are more likely to self-disconnect from their gas or electric,” she explained. Citizens Advice predicts that 450,000 people could be forced onto a prepayment plan this winter and of those, it expects 180,000 to be made as automatic remote switches via a smart meter.
Steep rise
More than 152,000 households with smart meters were remotely switched to more expensive prepayment plans by their supplier last year, according to data from Ofgem. There has been a steep rise in remote switches. Some 56,000 homes saw their electricity switched in 2020. That more than doubled to 108,000 in 2021. Some 39,000 households had their gas meter switched in 2020, which increased almost fourfold to 152,000 in 2021.
The BBC contacted suppliers for 2022 data. None would share the information but will be reporting an update to Ofgem at the end of the year. Nonetheless, the huge rise in energy prices means it is anticipated that this trend in more remote switches has continued. Ofgem said that 60,000 households had been switched over the past three months.
Why is this allowed and what can you do?
- Before smart meters existed, energy firms would have to get a warrant to enter your home and physically install a prepayment meter
- Now, smart meters enable energy firms to switch customers from direct debit payments to a prepayment meter system remotely
- Ofgem rules state that energy suppliers must have effective checks and balances in place when switching the mode of a smart meter
- The regulator advises customers with concerns to speak to their supplier. Under Ofgem rules they must offer payment plans you can afford and you can ask for emergency credit if you use a prepay meter and can’t top up
- Step Change debt charity can help you to apply.
- Citizens Advice offers this guide: Stop your energy supplier from moving you to prepayment
Breathing Space, sometimes called the Debt Respite Scheme, is a free government scheme that could give you up to 60 days’ space from creditors to set up a debt solution.
Ofgem said it was concerned about reports that some vulnerable customers were being switched to prepayment meters without full regard to their situation. “In extreme cases reports we received suggested this had led to some vulnerable customers being left without power for days or even weeks,” a spokesperson said. “This is completely unacceptable, especially as we head into a very challenging winter.” It said customers should be told that smart meters can be switched.
Neil Lawrence, director of retail at Ofgem, said: “Smart meter pre-payment switches are on the increase, and we do monitor that data.” “This should only be when it’s safe and practical to do so, and smart meters should not be switched without those appropriate assessments taking place, including identifying vulnerability,” he added. Ofgem has written to all suppliers to urgently remind them of their obligations. “Where they fail to do so, we will take action against them,” he said.
