What are your options if you don’t want to be forced to get a prepayment meter because of energy bill arrears?
A prepayment meter doesn’t make it easier to budget, the energy is more expensive and you face very high charges over the winter. So it’s very sensible to try to avoid one.
For winter 2023-24, Ofgem has introduced some extra protections for the most vulnerable households. A prepayment meter cannot be installed without you agreeing if you have a child under 2 or where everyone is aged over 75. But you may not come into one of the “most vulnerable” categories that is protected.
This article has 9 practical steps that may help you to avoid having a prepayment meter.
Try to reduce the amount you have to pay
1) Challenge an unreasonable direct debit
Your supplier has to explain how they have calculated the direct debit amount they say you need to pay. You can complain if they don’t do this.
Once you can see the calculation, it may be obvious what is wrong with it. For example, they may be ignoring the credit you have built up. Or may be basing the usage on the previous tenant so it isn’t right for you.
See “My energy direct debit isn’t just too high, it’s wrong” for how to challenge this.
A direct debit set at an accurate amount is the simplest way to smooth the amount you pay over the year, so you don’t have major problems in the winter months. So it makes sense to try to get your DD right, rather than try to pay when bills arrive or get a prepayment meter.
2) Get an arrangement for arrears
If you already have energy bill arrears, repaying these may be making your situation worse, so find out if you can get the arrears repayments reduced. Your energy company should not ask you to pay more to the arrears than you can afford, but many do.
You can complain and take this complaint to the Energy Ombudsman. Your local Citizens Advice can help you do this, by providing an income & expenditure statement to your supplier that shows what you can afford.
3) Reduce your energy usage
As the weather gets colder it’s harder to leave the heating off. A room temperature below 18C isn’t good for even a healthy body. And if anyone in your family has heart, breathing, joint, mobility, or many other health problems, they need a warm home.
In 2021, academics estimated that cold homes cost NHS England £860m a year and that 10,000 people die every year because of a cold home. That looks set to be much worse this winter as energy bills have more than doubled.
But if you have a combi boiler – a gas boiler where there is no hot water tank – then you may be able to save money by changing the controls on the boiler. This doesn’t mean turning down the thermostat in the room. Your boiler is probably set to default settings which are very inefficient, so you can change these and have just as warm a house. Try the Money Saving Boiler Challenge which explains what to do.
See this MSE article for other money-saving heating tips.
Find ways to be able to pay more
4) Check if there are any benefits you are entitled to
There are millions of people who are eligible to claim benefits who don’t realise it. Just a few examples:
- you can get Pension Credit even if you own your house, have a mortgage, still work a few hours a week or have a small employer’s pension;
- some workers with a full-time job that pays much more than the minimum wage can get Universal Credit;
- you may think UC covers the help you can get with council tax – it doesn’t, you can get Council Tax Support from your local council.
From April 2023, when benefits go up 10%, even more people will be eligible for benefits.
Most of the help in 2023 with energy bills will go to people getting benefits. The £400 help everyone gets this year will have ended. So check now if you are eligible.
Use this benefits checker to see and if you are unsure, ask your local Citizens Advice for help.
5) Pay less to other debts
Energy bills are priority debts. This means that your energy bills have to be paid first. That may not leave you enough money to pay non-priority debts such as credit cards, unsecured loans and catalogues.
A debt adviser can say what your options are for all your debts and the pros and cons of each. For example, it may be possible for you to only make a token £1 payment to each of your non-priority debts.
You may not want to harm your credit record, but not paying energy bills will be recorded as missed payments and then defaults. There may be no options that can protect your credit score.
Reduce the chance of having to have a pre-payment meter
6) Pay what you can each month
If your supplier says you have to pay £270 this month and you can’t afford that, what can you pay? Pay nothing and the arrears build up very fast. If you can pay £150 or £200, this will happen much slower.
Making a regular payment also signals to your supplier that you are doing your best, that you probably can’t pay more, you aren’t just choosing not to.
7) Can you get your name added to the Priority Services Register
The Priority Services Register (PSR) offers extra support to people in vulnerable situations. Ofgem has a list here, check if you qualify. This includes things like being a pensioner, being pregnant, having young children and having a mental health condition.
Being on the PSR doesn’t prevent a supplier from fitting a prepayment meter. But shows you are vulnerable and Ofgem says:
Prepayment meters should not be installed or remotely switched without carrying out the appropriate safe and reasonably practicable assessment, including identifying any vulnerability.
so it may make your energy company think twice about whether this is the right thing to do in your case.
Being on the PSR will also get you extra support, for example if there is a power cut caused by a big storm.
8) Know the reasons a supplier cannot fit a prepayment meter
Your supplier can’t make you move to a prepayment meter if it wouldn’t be safe or practical for you. This Citizens Advice page lists reasons: Stop your energy supplier moving you to prepayment.
Ofgem has recently written to all suppliers emphasising these points. Its paper Good practice for supporting customers in payment difficulty says:
If a consumer is in a vulnerable situation, suppliers could consider the full range of debt forbearance options, including pausing or deferring debt recovery actions until there is a material change in a consumer’s circumstance. We consider it good practice to pause debt recovery actions for consumers in a negative income who have an inability to pay their arrears.
Fitting a prepayment meter is a debt recovery action.
Here “a negative income” is where you don’t have enough money to pay all your essential bills and everyday living expenses. An income & expenditure sheet drawn up a debt adviser can help to demonstrate this.
9) Reject a smart meter if you don’t have one
An energy supplier can switch a smart meter to work as a prepayment meter remotely without you agreeing and without anyone having to enter your home. See Should I get a smart meter? for details.
If you don’t have a smart meter this is much longer process and the supplier has to go to court. So if you don’t want a prepayment meter you want to make this as hard as possible – don’t agree to having a smart meter!
Get help with this
None of these steps is guaranteed to stop a prepayment meter from being fitted unless you can actually pay the bills in full. But the aim is to try to improve your situation in as many ways as possible, even if some of them are small.
You will have spotted the theme running through them – talk to your local Citizens Advice if you need help with this.
Don’t assume there is nothing that can be done. A good debt adviser can help check your benefits situation and may know about local help available as well as being able to advise on your debts and help you with energy bill problems.