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30 June, 2020 Open access

Ofgem proposes formal requirement on energy suppliers to offer and monitor repayment rates based on a customer’s ability to pay

Proposals in consultation on improving protection of consumers also include making package of support provided during COVID-19 permanent from this winter

Ofgem has launched a consultation on improving protection of energy customers struggling with energy bills, including proposals to impose a formal requirement on suppliers to offer and monitor repayment rates based on ability to pay.

The statutory consultation, launched this week, confirms proposals first outlined in August 2019 to improve outcomes for consumers who self-disconnect, self-ration and are struggling to pay their energy bills, including by introducing a formal license requirement for suppliers to set, and then monitor, repayment rates based on a customer's ability to pay.

In addition, welcoming how energy supply companies have voluntarily agreed to support vulnerable customers in response to coronavirus (COVID-19) - including by providing practical support regarding emergency top-ups, provision of advice, switching between credit and prepayment mode, and the extension of non-disconnection periods - Ofgem says that is proposing to make many of these protective measures permanent.

Commenting on the consultation, Chief Executive of Ofgem Jonathan Brearley said -

'I want to thank suppliers for their efforts during this crisis in keeping essential energy supplies flowing to customers, particularly those in vulnerable situations. These permanent protections will reduce the number of prepayment customers temporarily going without energy because they cannot afford to top up. It is always best for customers to keep up with their energy bills if they can. But at this time when many may face financial hardship, these proposals mean those who are struggling to keep up are assured of some breathing space.’

For more information see More help for prepayment customers and those struggling with bills