Ofgem proposals on prepayment meters installed under warrant and measures for a fairer more competitive energy market

[ALEO Admin]

In an open letter to Secretary of State for Business, Energy and Industrial Strategy, dated 3 July, Ofgem has announced its plans to deliver a fairer, more competitive market for all consumers.

These plans are in response to the recommendations of the Competition and Markets Authority (CMA) published in June 2016, following its two-year investigation into the energy market. (See viewtopic.php?f=86&t=774&p=735&hilit=pre+payment#p735)

Ofgem has opened a new consultation - 'Prepayment meters installed under warrant - statutory consultation' - which includes plans for a £150 cap on charges to customers for installing a pre-payment meter under warrant, as well as a ban on charges for the most vulnerable customers and the option of introducing a safeguard tariff for them. This follows Ofgem's previous consultation on 'Prepayment meters installed under warrant: final proposals' published in September 2016, to which ALEO submitted a response (see viewtopic.php?f=129&t=884).

The consultation also proposes:
- A prohibition on suppliers using warrants in certain exceptional cases, intended to ensure that customers 'do not suffer the trauma of the force-fitting experience, which they might otherwise endure due to their mental capacity and/or psychological state'

- A prohibition on suppliers levying warrant-related costs in certain other cases, intended to protect vulnerable customers and those who are already in severe financial difficulty

- A proportionality principle, to ensure that suppliers take actions and levy charges that are proportionate in all cases where they seek to recover debt from consumers.

- A 'sunset clause' by which prohibitions would cease to apply at the expected end-date for smart meter rollout (31 December 2020), since Ofgem expects the rollout of smart meters to ultimately remove the need for the physical installation of prepayment meters using a warrant to force entry.

Ofgem's deadline for responses to this new consultation is 29 August 2017.
For full details, see https://www.ofgem.gov.uk/publications-a ... nsultation

Ofgem has also announced new consumer engagement measures designed to help and encourage customers to switch energy suppliers.

These measures include a “Check Your Energy Deal” trial - an online switching service to help customers who have been on their suppliers’ expensive standard tariff for three years or more to find cheaper offers. The service, to be trialed in Northampton from September, will know the tariff and consumption information of customers who are taking part in the trial, making it easier for them to find a cheaper deal.

In a separate trial, customers will receive a tailored letter from their supplier or from Ofgem telling them about cheaper offers from rival companies.

Ofgem is also proposing to remove a rule in Ofgem's voluntary Confidence Code for comparison website, which requires them to show tariffs that the customer cannot directly switch to, as the CMA found that this rule is making it more difficult for customers to switch.

Ofgem is also planning to consult on the way that personalised estimates of the annual cost of energy tariffs are calculated, to help customers shop around and compare deals. For more information on this, see: https://www.ofgem.gov.uk/publications-a ... ay-forward

For Ofgem's press release and to download its letter to the Secretary of State, visit:
https://www.ofgem.gov.uk/publications-a ... -consumers

[ALEO Admin]

Ofgem published the outcome of this consultation on 10 November 2017.

From January 2018, charges for installing pre-payment meters under warrant for all consumers will be capped at £150, and pre-payment meter installations and charges will be banned for the most vulnerable.