Prepayment meter tariffs rise – your rights when it comes to meters

Martin Lewis offers advice on prepayment meters and rate changes

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The new energy price guarantee saw the annual bill for an average household rise to a staggering £2,500, which is approximately 80 percent more than what people were paying this time last year. However, households experiencing difficulty covering the soaring costs may be forced to switch over to a prepayment meter.

While using a meter can make it easier for consumers to avoid falling into energy debt, there are certain rules energy providers must follow when it comes to installation.

What is a prepayment meter?

A prepayment meter is a type of pay-as-you-go energy tariff, which means households must pay for their electricity before they use it by topping up the credit on the meter.

Despite the pay-as-you-go nature of this tariff, customers still have access to the £400 energy bill support scheme. Depending on the meter, smart or traditional, people will either have the discount credited directly to the meter or through vouchers issued by text, email or post.

However, prepayment meters are typically more expensive than ordinary meters and offer fewer tariffs, and energy firms can also dock debt from the top-ups. Those who cannot afford to top up their meter run the risk of being disconnected from their power.

Can my provider force me to have a prepayment meter?

While it might seem impermissible, there are instances where energy providers may be able to make moves to set up a customer on a prepayment meter.

Bionic content manager Les Roberts said: “If you fall behind on your energy bill payments, your supplier can take steps to install a prepayment meter in your home.”

However, there are some conditions they must follow prior to installation, according to Mr Roberts.

He said: “They have to give you at least 28 days to repay any debt you fall into before this happens.

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“If the debt is still not repaid, the supplier must give seven days’ notice before the meter is installed at which point they do have the right to gain a warrant to enter your home or they could change your smart meter to a pay-as-you-go set up.

“If you refuse to grant access to your home for the installation to take place, your provider could cut off your energy supply.”

Can you refuse to have a prepayment meter installed?

A provider cannot force a person to have a prepayment meter if it is impractical, for example, if a person is disabled or chronically ill and are unable to top up the meter. According to Mr Roberts, they must arrange for the person to pay in another way.

Mr Roberts continued: “Your provider is also obliged to move your prepayment meter to a more accessible location if you are struggling to access it. For example, if you have limited mobility and the prepayment meter has been installed out of your reach.

“If you are unable to access a shop to top up your meter because it is a public holiday or closed in the evenings or on the weekends, there is such a thing as friendly credit.

“This means your supply most likely won’t be cut off if you run out of credit between the hours of 6pm and 9am, on Sundays and on bank holidays. But you’ll have to repay any energy you’ve used when you do top-up.”

What support should a provider be offering?

A prepayment meter should be a last resort if a person is in energy debt. Under official Ofgem rules, a provider should first offer a payment plan or help to set up a repayment plan through the person’s state benefits.

Mr Roberts said: “As part of a repayment plan, they must organise an affordable payment plan and consumers have the right to ask to review the bill to see if the amount is correct.

“You can also ask for a break from payments until you can afford to pay, a reduction to an affordable rate and more time between payments. Your provider should also give you access to advice about how to reduce energy usage.”

Providers must also enable access to any available hardship funds, charitable grants, or help with applications for any available Government grants if they have not been automatically applied.

This can include schemes such as the Cold Weather Payment, which is available when the temperature drops below a certain level and a person is at state pension age or claiming certain benefits.

However, Mr Roberts noted: “When you are on a prepayment meter, you are able to access a small amount of emergency credit when you’re running out of money on your meter and your supplier must tell you how to do this.”

But, he continued: “Bear in mind, any emergency credit you use must be paid back.”

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