UK Energy Secretary Slams Low Compensation Payouts for Forced Prepayment Meters

Energy Secretary criticizes low compensation payouts to customers forced onto prepayment meters, vows to expedite the process and ensure affected customers receive the redress they deserve.

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Ayesha Mumtaz
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UK Energy Secretary Slams Low Compensation Payouts for Forced Prepayment Meters

UK Energy Secretary Slams Low Compensation Payouts for Forced Prepayment Meters

Energy Secretary Claire Coutinho has strongly criticized the "completely unacceptable" low number of compensation payouts to people wrongly forced onto prepayment meters by energy suppliers in the UK. Out of 150,000 assessed cases, only 1,500 individuals have received financial redress as of April 2024, according to Ofgem, the energy regulator.

Coutinho has personally engaged with Ofgem to expedite the compensation process and ensure that affected customers receive the payouts they are owed as soon as possible. Ofgem confirmed that suppliers have reviewed around 150,000 cases so far and determined that just over 2,500 customers are entitled to compensation. However, only 1,502 customers have received initial payments totaling £342,450, with an additional £200,000 set aside for another 1,000 customers.

The issue came to light last year when agents acting on behalf of British Gas were found to be forcing their way into homes and installing prepayment meters against Ofgem's rules, triggering a public outcry. British Gas, the supplier at the center of the scandal, has not been included in the compensation figures released so far as it is subject to a separate ongoing investigation.

Why this matters: The forced installation of prepayment meters has affected a significant number of vulnerable individuals, raising concerns about the practices of energy suppliers. The low number of compensation payouts highlights the need for stronger oversight and accountability in the energy sector to ensure that affected customers receive the redress they deserve.

Coutinho rejected the suggestion that the government is abandoning thousands of people due to the small number of payouts. She emphasized that the situation is "completely unacceptable" and that the government is ready to act to ensure people receive the compensation they are owed. Ofgem has instructed all energy suppliers to review cases of individuals who were coerced onto prepayment meters between January 2022 and January 2023 to assess their eligibility for compensation. The final compensation total is anticipated by the end of June 2024.

Key Takeaways

  • Energy Secretary criticizes low compensation payouts for forced prepayment meters.
  • Out of 150,000 assessed cases, only 1,500 individuals have received compensation.
  • British Gas, at the center of the scandal, is subject to a separate investigation.
  • Ofgem has instructed suppliers to review cases for compensation by June 2024.
  • The low payouts highlight the need for stronger oversight in the energy sector.