This in from Ray on behalf of the Footprint Trust. Ed
Energy expert charity The Footprint Trust has generally welcomed the Competition and Markets Authority recommendations, which includes a price freeze for those using expensive pre-payment meters.
The move will help around four million low income households throughout Britain. These households can pay up to £250 per year more than the best deal available to those on a standard meter.
Use of prepayment meters has risen
The proportion of energy customers on prepayment meters has increased steadily over the last 20 years, from 7% in 1996 to 16% currently. Unlike the choice of whether to pay by direct debit or standard credit, prepayment is not generally a choice on the part of the customer.
Prepayment meters are generally installed where a customer has had a poor payment history, due to fuel poverty, or in certain types of accommodation such as student accommodation and others on low income.
Nearly all prepayment customers are on standard variable tariffs, reflecting the limited choice of non-standard tariffs they face.
10,000 Islanders in fuel poverty
Ray Harrington-Vail, the charity senior energy worker and National Heat Hero, said,
“The Island has some 10,000 people in fuel poverty, and this proposal will be of some help in reducing their burden of debt. It is ironic that the poorest people are paying the highest price per unit of power. If you get in debt with your energy company, you are then put on a pre-payment meter, which can increase your debt due to the expensive tariff.
“Another issue raised by the Authority was the issue of many thousands of customers being on high standard tariffs, rather than the best cheapest deal from their supplier, or from an alternative supplier. This means that many energy consumers are paying hundreds of pounds per year too much for their energy.”
He went on to add,
“Which? and The Sun newspaper are to be commended for their campaigns on this issue, which has now brought about some help for those in fuel poverty.
“We would urge everyone to contact their energy company and check they are on the best deal. An even better deal can be had by using popular price comparison sites, which are regularly advertised on TV. Switching supplier could save a household up to £400 per year.”
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