Source · Select Committees · Business and Trade Committee
Recommendation 51
51
Acknowledged
Paragraph: 202
We recommend that Ofgem urgently improves its data collection on self-disconnection and publishes this on...
Recommendation
We recommend that Ofgem urgently improves its data collection on self-disconnection and publishes this on a more frequent basis. We ask Ofgem to conduct an impact analysis on how expected increases to the price cap this winter will affect customers at risk of self-disconnection. We call on Ofgem to review the existing Ability To Pay framework to determine whether further, immediate action is needed to address an increase in self-disconnection come October. We also ask Ofgem, ahead of this winter, to work with suppliers to help identify vulnerable prepayment customers who are at risk of self-disconnection, for example those who have high energy demand due to the use of medical equipment and offer to convert these users to credit mode to maintain their supply.
Government Response Summary
Ofgem introduced a quarterly request for information on prepayment meter customers, including self-disconnection, in Q4 2021 but is waiting to have at least one year of data before making it publicly available, possibly in early 2023; they also state the existing Ability to Pay rules require suppliers to assess a consumer’s ability to pay and agree an affordable payment plan.
Paragraph Reference:
202
Government Response
Acknowledged
HM Government
Acknowledged
In Q4 2021 Ofgem introduced a quarterly request for information to gather data from larger domestic suppliers on various datapoints in relation to pre-payment meter customers, including self-disconnection. Due to the challenges around identifying self- disconnection, Ofgem is currently only able to obtain data in relation to smart-PPM customers, comprising around 1.9m smart-PPM electricity customers and 1.4m smart- PPM gas customers. Analysis of data is produced quarterly and considered within Ofgem, including on market trends with regards self-disconnection. Ofgem’s view is that it would be preferable to have longer-term data available (at least one-years) prior to making it publicly available. Ofgem anticipates there will be significant seasonal impacts on the levels of self-disconnection observed, and as such it would be advantageous to have considered this, prior to making data public. Therefore, it may be early 2023 before the data is made available. The Ability to Pay rules are covered by Standard Licence Condition 27.5. It is clear that suppliers must assess a consumer’s ability to pay their energy bills. They should agree an affordable payment plan to help consumers stay on supply. Suppliers should only install a prepayment meter if it is safe and practicable to do so. This is covered by SLC 28.1B. Ofgem published guidance on this in 2016, which stated that suppliers should assess whether it is safe and practicable to install a prepayment meter for reasons including “whether the customer requires a continuous supply for health reasons, such as dependency on medical equipment requiring an electricity supply.”