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Energy firms 'profit from poor' | Energy firms 'profit from poor' |
(3 days later) | |
Energy suppliers make some of their biggest profits from their poorest customers, a watchdog has said. | Energy suppliers make some of their biggest profits from their poorest customers, a watchdog has said. |
Firms make about half a billion pounds a year in extra charges from prepayment meters, Consumer Focus estimates. | Firms make about half a billion pounds a year in extra charges from prepayment meters, Consumer Focus estimates. |
About 1,000 prepayment meters a day are being installed in households where people have got into debt over their energy bills, it says. | About 1,000 prepayment meters a day are being installed in households where people have got into debt over their energy bills, it says. |
Industry body the Energy Retail Association says many people like the meters because they help them budget. | Industry body the Energy Retail Association says many people like the meters because they help them budget. |
But the industry is now under pressure from the regulator, Ofgem, to cut the prepayment tariffs. | But the industry is now under pressure from the regulator, Ofgem, to cut the prepayment tariffs. |
They're being pushed onto prepayment meters Tony Herbert, Citizens Advice Prepayment meters: Your stories Consumer Focus says some customers are being forced to use prepayment meters. | They're being pushed onto prepayment meters Tony Herbert, Citizens Advice Prepayment meters: Your stories Consumer Focus says some customers are being forced to use prepayment meters. |
It said energy firms are using customers who pay by prepayment meter to subsidise customers who can get the cheapest deals. | It said energy firms are using customers who pay by prepayment meter to subsidise customers who can get the cheapest deals. |
"Companies could be making up to £550m a year from extra charges they charge on prepayment meters," said the watchdog's Jonathan Stearn. | "Companies could be making up to £550m a year from extra charges they charge on prepayment meters," said the watchdog's Jonathan Stearn. |
"The energy companies are making the most money out of those on prepayment meters, and often those are the people on the very lowest incomes." | "The energy companies are making the most money out of those on prepayment meters, and often those are the people on the very lowest incomes." |
Rules broken | Rules broken |
Tony Herbert, Social Policy Officer at Citizens Advice, says its offices have seen a small number of cases where companies have pushed customers onto prepayment meters when they have not given them other options to pay any outstanding debt. | Tony Herbert, Social Policy Officer at Citizens Advice, says its offices have seen a small number of cases where companies have pushed customers onto prepayment meters when they have not given them other options to pay any outstanding debt. |
This is against the companies' own rules, he says. | This is against the companies' own rules, he says. |
"These people have built up debt but they are not being offered a range of payment methods and they're not being offered affordable repayment rates," he said. | "These people have built up debt but they are not being offered a range of payment methods and they're not being offered affordable repayment rates," he said. |
"They're being pushed onto prepayment meters." | "They're being pushed onto prepayment meters." |
Samira Naji, who lives in North London, had a prepayment meter fitted by E.ON after the firm said she owed over £700. | Samira Naji, who lives in North London, had a prepayment meter fitted by E.ON after the firm said she owed over £700. |
The problem was that she had been paying another supplier - EDF - for her electricity and didn't think she owed a penny. | The problem was that she had been paying another supplier - EDF - for her electricity and didn't think she owed a penny. |
Because of a mix-up, she was paying the wrong company. | Because of a mix-up, she was paying the wrong company. |
'Shocked and confused' | 'Shocked and confused' |
After weeks of disagreement E.ON got a court warrant to fit a prepayment meter, and - while she was on holiday - removed the locks to gain access to her flat. | After weeks of disagreement E.ON got a court warrant to fit a prepayment meter, and - while she was on holiday - removed the locks to gain access to her flat. |
When Ms Naji returned from holiday, she thought she had been burgled. | When Ms Naji returned from holiday, she thought she had been burgled. |
"I was really, really shocked and confused. I didn't realise they could come into my property, especially if I was away on holiday." | "I was really, really shocked and confused. I didn't realise they could come into my property, especially if I was away on holiday." |
When contacted by the BBC EDF, the company Ms Naji had been paying for the last six years, said it would refund the disputed energy bill. | When contacted by the BBC EDF, the company Ms Naji had been paying for the last six years, said it would refund the disputed energy bill. |
E.ON said it would write off the court costs and try to agree terms with Ms Naji to remove the prepayment meter. | E.ON said it would write off the court costs and try to agree terms with Ms Naji to remove the prepayment meter. |
Your comments: | |
I am so upset because just two days ago I called my supplier because of an ongoing query about my account and they told me that I had to have a meter fitted to clear my bill. I was told that they could as a matter of goodwill halve my payments to them at £15 per week on top of my normal consumption. I told them that I couldn't afford to pay so much a week because I am disabled and on benefits.Beverley, Plymouth, Devon | I am so upset because just two days ago I called my supplier because of an ongoing query about my account and they told me that I had to have a meter fitted to clear my bill. I was told that they could as a matter of goodwill halve my payments to them at £15 per week on top of my normal consumption. I told them that I couldn't afford to pay so much a week because I am disabled and on benefits.Beverley, Plymouth, Devon |
I am on a low income & when I asked Eon about removing my prepayment meter & go on direct debit I was told it would cost me £50. It seems you cant get out of this trap even if you want to.Ian Walters, Ipswich Suffolk | I am on a low income & when I asked Eon about removing my prepayment meter & go on direct debit I was told it would cost me £50. It seems you cant get out of this trap even if you want to.Ian Walters, Ipswich Suffolk |
I moved into my flat in last year. My flat has a pre-paid meter. I used to pay about £7 per week. At the beginning of October my meter shot up, and I now pay £25.00 per week! I'm a single working mother and this is crippling me. I'm not sure who my supplier is as there is no indication on the meter. When I call to find out who my supplier is there is confusion with my flats address. I want to know why it's SO expensive and am I due a rebate!Charlotte, Brighton | I moved into my flat in last year. My flat has a pre-paid meter. I used to pay about £7 per week. At the beginning of October my meter shot up, and I now pay £25.00 per week! I'm a single working mother and this is crippling me. I'm not sure who my supplier is as there is no indication on the meter. When I call to find out who my supplier is there is confusion with my flats address. I want to know why it's SO expensive and am I due a rebate!Charlotte, Brighton |
I watched with some interest the debate on this morning's news regarding pre-payment meters. I'm afraid the impression given was that those on these meters are all somehow in debt. I live in a small privately rented flat. Because the lease is short term the landlord had quite understandably installed these meters. I am not in debt. Nevertheless I struggle to pay the costs and as I suffer from rheumatoid arthritis, I need to have the heating on more than I would like. The government should ORDER these energy companies to change.Roger Burt, Wick, Highland | I watched with some interest the debate on this morning's news regarding pre-payment meters. I'm afraid the impression given was that those on these meters are all somehow in debt. I live in a small privately rented flat. Because the lease is short term the landlord had quite understandably installed these meters. I am not in debt. Nevertheless I struggle to pay the costs and as I suffer from rheumatoid arthritis, I need to have the heating on more than I would like. The government should ORDER these energy companies to change.Roger Burt, Wick, Highland |