Big Win for Prepayment Meter Users as Govt Slashes Energy Bills
From today, 3 million UK households on prepayment energy meters are set to save cash as the government scraps the prepayment meter premium. Their bills will now match those paying by direct debit, with the government footing the bill for the difference.
Prepayment Meter Premium Axed – Saver Alert!
Households using pay-as-you-go meters have long paid more – about £21 extra a year – due to supplier costs like payment collection and vouchers. That ends now. The government’s move clamps down on this unfair surcharge, giving particularly low-income families a much-needed boost.
Energy Price Cap Cuts Bills by Hundreds
This change coincides with Ofgem’s latest price cap update. Thanks to wholesale market improvements, typical annual energy bills will tumble from £2,500 under the Energy Price Guarantee to roughly £2,074 – that’s an average saving of £426, or 17% off! This slash in energy costs is expected to ease inflation pressures, ticking off a key promise from the Prime Minister.
Officials Pledge to End Prepay Penalty
“We’re ending the historic injustice of charging more for prepayment meters,” declared Amanda Solloway, Energy Consumers and Affordability Minister. “This vital support will help those on lower incomes.”
The government will cover the prepayment premium till April 2024 before Ofgem crafts a permanent fix. Earlier, Energy Secretary Grant Shapps cracked down on dodgy prepayment meter installs, demanding stricter oversight to protect vulnerable households.
Billions Poured into Energy Support
Between October 2022 and March 2023, the government splashed out nearly £40 billion to keep energy costs down – the biggest subsidy in UK history. Over winter, it picked up nearly half of the average home’s energy bill, saving families around £1,500 by June.
This included £650 million for prepayment meter homes through the Energy Bills Support Scheme, doling out £400 in vouchers over six months. By May, 85% of these vouchers had been snapped up, with more expected to follow.
