Being a prepayment energy meter customer usually means you’ve struggled with your gas or electricity bills at some point. That’s why your energy provider installs prepayment meter – to make sure you’ll always cover your bills.
But you can often end up paying more for your energy with a prepayment meter, meaning you might find it even harder to afford. That’s why the energy regulator Ofgem has announced a new cap to prepayment energy bills. So if you’ve got one of these meters, it means you could now save money on your gas and electricity.
What does this mean for you?
Ofgem announced that the prepayment meter energy cap would come into force on 1 April 2017 – meaning it actually launched yesterday. That means you should start feeling the effects of the price cap very soon.
The cap could save you around £80 a year on your energy bills and if you’re on a tight budget, it’s likely that this could make things a little easier.
Ofgem will set the level of the cap once every six months. As we mentioned above, the cap started on 1 April 2017 so it will next change on 1 October 2017. Going forwards, it will happen on these dates every year until the end of the prepayment meter cap.
Your energy supplier needs to make sure you don’t pay any more for your gas and electricity than the level of the cap. So if your bills are currently more than this, your energy provider might need to adjust them to ensure they’re not too expensive.
How long will it last?
The prepayment meter cap is only a temporary measure – it will last until the smart meter rollout finishes in 2020. This is where the Government has pledged to offer all energy customers a smart meter, whether they’re on a prepayment meter or a standard energy meter.
Smart meters can be a better way to pay for your energy as they mean you only pay for the gas and electricity you actually use, rather than getting an estimated bill like most people do. As this is already how prepayment customers pay for their energy bills, it should also hopefully mean a fairer system for those on prepayment meters.
That’s why the temporary cap is due to end when the vast majority of the UK has smart meters. If you’re on a prepayment meter at this time, you should hopefully be eligible for cheaper rates for your gas and electricity.
You can have a prepayment smart meter so if your energy provider gets in touch to offer you one, you won’t have to pay for them to install this. But do you have to have a smart meter or can you refuse one? Find out the answer to this question in our blog.