Press Release
MP Backing Consumers As He Presents Dossier To OFGEM
Following a comprehensive study of how domestic energy consumers are being treated local MP Tom Clarke handed over a 67 page dossier to the Gas and Electricity Regulator Ofgem, at their London Headquarters. Mr Clarke is fighting for a better deal for consumers generally, many of whom he believes are powerless to stand up to Energy Suppliers, particularly those on prepayment metres.
The MP said:
“I have been working on this subject since June of last year and I am pleased that Energy Suppliers are beginning to reduce their prices to consumers, but there is still an awful long way to go, and I intend t o pursue Suppliers on this issue of price. There are two specific problems facing households who use Pre Payment Metres (PPM’s). First is the added cost they have to bear compared with direct debit customers. And secondly, back charging which means that PPM users can incur debt without even knowing about it. There is yawning gap of £103 per annum between direct debit customers and those on low incomes, using Pre Payment Metres (PPM’s). I have established that 25% of PPM customers are on incomes of £10,000 or less. Nearly one third of PPM users have a long term illness or disability. And more than one third are lone parents with dependent children. It is disgraceful and unacceptable that over 1.3 million households are financially penalised in this way. I am outraged that the poorest households in our communities are paying 130 million pounds for the privilege of having a pre payment metre. When the facts are addressed there is simply no logical or financial argument that can be sustained by Energy Suppliers”.
“The problem doesn’t end with having prepayment metre. These meters need to be reset manually following any price rise. Three companies, Scottish Power, Npower and Powergen, have a policy of back charging customers who have not had their meter reset after a price rise. Inevitable delays in reading meters can cause financial chaos to the budgets of low income families. As far as I am concerned both the procedure for recalibrating meters and the target timescales have been ineffective. Consumers quite rightly complain that they have had no communication on the need for their meter to be reset following a price rise. Even where access has been gained the debt has been applied to the meter often without the customers’ knowledge. The result is that the credit they put in to the meter is used up at a much quicker rate”.
“I have been actively campaigning on this problem for some time and significant political pressure is now being brought to bear on all of the suppliers who adopt a policy of back charging. Indeed politicians from all parties have signed Early Day Motions (EDM’s) on this specific subject. In view of the prevailing opinion amongst MPs at Westminster and given that certain energy companies are not strictly complying with Electricity Supply Licence, I am seeking Ofgem’s intervention to end the practice of back charging as the fairest solution to consumers”.
The MP continued:
“Despite calls for an end to the practice of back charging all three suppliers have been robust in their defence of continuing to do so. Their main argument is that they have speeded up replacing token meters with new meters which can be recalibrated remotely. In this age of technology it shouldn’t be too difficult to find an immediate and effective remedy”.
Mr Clarke concluded:
“My meeting with the Chief Executive of Ofgem Mr Alistair Bucahanan was extremely interesting and there was a great deal of common ground between us on how the Energy Suppliers have not exactly covered themselves in glory. I expect that he will consider my representations which were on a range of issues and I look forward to his response.”
The MP has lined up a meeting with the Minister for Energy Lord Truscott which will be held within the next two weeks.