(Bloomberg) -- The UK plans to reform rules around prepayment energy meters, to protect financially vulnerable consumers in the wake of a recent uproar over forced installations.
Ministers are drawing up changes to make the system fairer, according to two people familiar with the matter who spoke on condition of anonymity because the proposals haven’t been announced. On Friday energy regulator Ofgem launched a national call for evidence as part of its own review into the meters.
Prepayment meters — which require households to pay for their energy in advance — have become a point of controversy after allegations that Centrica Plc’s British Gas forcibly installed them in the homes of customers struggling to pay their bills. Last month Ofgem told British Gas to temporarily stop doing forced installations, something Centrica said it would do “at least until the end of the winter.”
Overall, about 4.5 million households nationwide use prepayment meters, designed to help users avoid racking up bills they can’t afford. The meters require people to pay for energy ahead of time — at the post office or a shop, for example. Once that credit runs out, lights go off and heaters shut down.
The people familiar didn’t provide further details on the nature of the planned reforms. The government may make an announcement ahead of Chancellor of the Exchequer Jeremy Hunt’s budget on March 15, one of them said. Neither the Treasury nor the Department for Energy Security and Net Zero immediately responded to a request for comment.
The campaign group End Fuel Poverty Coalition has called on the government to ban forced installations, because too many customers are struggling.
“Households are facing unprecedented rises in energy bills, forcing many into energy debt and putting them at risk of being forced onto prepayment meters,” Ofgem CEO Jonathan Brearley said in an e-mailed statement on Friday. “Installing forced prepayment meters must be a last resort where all other options have been exhausted.”
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