Switching away from prepayment could save you money

After a year of relentless price rises, many of the 1.3 million customers on electricity token meters will be caught out financially when their meters are finally brought up to date to reflect the new prices.

The delay in the process leaves customers vulnerable to falling into debt through no fault of their own according to uSwitch.com, the leading price comparison website.

Following Ofgem’s recent call to action, many of the suppliers have stepped up and promised to accelerate their plans to replace token meters with the new ‘smart’ pre-pay meters as well as writing off debts for those customers caught out.

Furthermore, consumers who have not switched providers could benefit from assessing their potential savings. On average bills could be cut by as much as 25% - a saving of £276 – by moving away from prepayment to the cheapest available online tariff. By moving over to a direct debit billing system customers will no longer be vulnerable to falling into debt following energy price rises triggered by delays in the suppliers recalibrating meters to register the new tariffs.

Geoff Slaughter, Product Manager at uSwitch.com commented: “The phasing out of old style electricity token meters is encouraging news for consumers, many of whom have been caught out already or are likely to be in the near future through no fault of their own. We commend the approach taken by EDF Energy and Scottish and Southern Energy not to charge customers any increased rates until the meters are recalibrated.

“Following Ofgem's intervention, British Gas has announced that from December 1 it will also write off any debt. Npower, ScottishPower and Powergen differ in their approach and performance but we hope that they will follow the lead of the other energy companies. No tariff changes should come at the expense of the consumer.

“We will watch with interest as the suppliers put their proposals into action. The question that remains unanswered is: Whilst 2006 has left customers susceptible to back-dated price rises due to this slow process, will any overpayments be refunded quickly if we see a drop in retail prices?”