British Gas has announced it will stop using contractors to fit prepayment meters under court warrant – but stopped short of phasing out its use of them.
Instead any future fitting of prepayment meters under warrant will be done in-house, overseen by the company.
The UK’s largest energy supplier has under pressure to respond since it was recorded using third-party operators to break into vulnerable households to forcibly install prepayment meters, in an undercover investigation from The Times earlier this year.
The newspaper revealed British Gas had been employing Arvato Financial Solutions to forcibly install prepayment meters.
Between January 2019 and December 2022, Arvato was granted almost 300,000 right of entry warrants on behalf of energy suppliers across the UK.
British Gas has now decided to no longer use external groups to install prepayment meters, after commissioning consultants Promontory Financial Services to investigate its use of them.
However, it is still on course to go back to using them to resolve and reclaim funds.
Approximately 15 per cent of the UK energy market, consisting of 4.1m electricity and 3.3m gas customers, use prepayment meters as their payment method.
Around 1.2m of these energy users are British Gas customers.
Promontory’s report found that there were no systemic issues with prepayment meters fitted under warrant, but that there were a number of cases where mistakes were made and the company could have acted differently.
The investigation sampled 321 cases – including 49 associated with The Times report – where a prepayment meter was fitted under warrant.
It found two customer cases where the investigation team considered that a prepayment meter was not appropriate because of the personal circumstances of the customers.
The investigation team also uncovered 13 cases where the Arvato warrant officer proceeded with a prepayment meter installation without recording if known vulnerability issues had been considered.
There were also two further cases, first identified by The Times, where a prepayment meter was justified but the behaviour of the agent fell far below British Gas’ expectation.
Chris O’Shea, chief executive of British Gas owner Centrica, said: “I was deeply concerned when I saw the way some of our prepayment customers were treated earlier this year. It’s not how I want us to do business and I’d like to take this opportunity once again to say how sorry I am and to apologise to anyone involved in cases where our actions fell short of the high standards we set ourselves.”
British Gas signs up to new code of practice for prepayment meter use
Ofgem demanded energy suppliers suspend the use of prepayment meters following British Gas’ conduct in January, as first reported by City A.M.
It has since required suppliers to commit to a code of practice on prepayment installations under warrant- with suppliers yet to return to forced installations through courts, which British Gas has signed up to.
This includes pledges to not carry out involuntary installations for the highest risk customers – such as over-85s living alone – and introducing the use of body cameras when installing prepayment meters in the homes of customers.
British Gas remains under investigation from Ofgem, which is also undertaking a wider market compliance review on the entire sector’s use of them.
The company could still be liable for fines and other penalties.
Meanwhile, O’Shea has also confirmed his support for a social tariff for vulnerable households, with the energy boss arguing that changes to prepayment meter processes do not “address the underlying problem of affordability”.
He said: “The introduction of a social tariff for energy would be a significant step in the right direction. The funding of it will be a policy decision for government but if we can get this right, and deal with the root cause of the affordability crisis, some of the difficult issues around fitting prepayment meters should no longer be necessary.”