Prepayment Meters Costs £226 More Per Year
Citizens Advice have stated that energy customers who purchase their power supply through prepayment meters are paying around £226 more every year than they would on other tariffs.
The charity organisation stated that the difference in cost between the most expensive and the cheapest tariffs have opened up by more than a third over the last half of the year. The Co-Operative has the largest gap at £405 and have recently reacted by saying that they will be cutting their prepayment meter costs.
The CMA (the Competition and Markets Authority) has been investigating the energy industry for the past year, with the final report being due on Tuesday.
"The CMA investigation provides an opportunity to overhaul the energy industry and make it fairer," said Gillian Guy, the chief executive of Citizens Advice.
"Giving pre-payment meter customers a better deal is a crucial part of this."
It has long been the case that those who are on prepayment meters are charged the most for their energy. This is despite the fact that those people are almost always the least able to pay such high fees. This new revelation about the difference in the costs of the tariffs has come at a very interesting time.
John Moylan stated:
"It comes just days before the initial findings from the year-long CMA probe into the energy sector.
That's expected to highlight the plight of millions of customers who either can't or don't switch and come up with remedies to change this.
It could be a landmark moment for the entire industry.
The Citizens Advice report feels like a shot across the CMA's bows - a warning that the energy market has to change to work better for millions of vulnerable customers - not least the increasing number of households that are tied to a pre-payment meter."
People who are on prepayment meters are often on lower incomes and around 80% of them are in debt before they have the meters installed. The meters can be imposed upon them if the energy company manages to get a court order.
The Co-operative has replied to the revelation of Citizens Advice:
"Following contact with Citizens Advice, we have taken the opportunity to review our dual fuel pre-payment tariff and will be reducing it to match the cheapest of the Big Six rates immediately."
Energy UK also responded to the findings:
"Suppliers are constantly reviewing their tariffs. We urge customers to shop around for the deal that suits them best,"
Save money on your energy bills by comparing gas and electric prices.