Pre-pay energy customers pay more

Prepay energy customers pay an average of £226 more per year than they would on the cheapest online direct debit deals, new research by Citizens Advice shows.

The national charity has released figures comparing energy companies’ cheapest prepayment meter (PPM) tariffs with their best online direct debit deals.

It shows PPM customers pay on average 22 per cent more.

Citizens Advice also provides a regional breakdown, which shows that the differences in prices are widening across the country. The charity says this highlights competition is not working for all consumers.

Research shows PPM users are more likely to be on lower incomes and analysis of figures from the regulator Ofgem last year highlighted 80 per cent of households having meters installed were already in debt.

Comment from Citizens Advice Chief Executive

Gillian Guy, Chief Executive of Citizens Advice, said:

“Prepay energy consumers get a raw deal.

“Our research shows many PPM customers have to fork out hundreds of pounds more than those on online direct debit deals. This unfairness leaves some of the poorest people struggling to heat their homes and keep the lights on.

“Since the launch of our campaign, some suppliers have said they will improve their PPM offer, but there is still a long way to go.

Call to action

Citizens Advice is calling on the Competition and Markets Authority (CMA) to address the unfairness in the energy market.

Source: Citizens Advice press release: Prepay energy customers paying £226 a year more

Turn2us resources on energy and fuel poverty

• Read the Turn2us Energy schemes information

• Read the Turn2us Grants for energy efficiency information

• Read the Turn2us fuel poverty information section

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Date of publication: 3 July 2015