Banning PPM switches would be a ‘problematic’ solution

Prohibiting suppliers from moving customers onto pre-payment meters (PPMs) will not solve the issues facing the poorest billpayers, according to the chair of Energy UK’s Vulnerability Commitment.

Speaking to Utility Week about the work suppliers have been doing over the past year to support vulnerable customers, Crabb admitted that reports of forced PPM installations had caused reputational damage for the sector over the past year.

However, he warned this is a nuanced debate and cautioned against knee-jerk reactions, including calls by fuel poverty campaigners for an outright ban on the practice.

He said: “It is very problematic and the difficulty comes in generalizing as opposed to looking at the circumstances in each case.

“You have to have a solution, rather than just saying ‘this is bad’. These are customers that can’t afford to pay for their energy. If you don’t want to put them on PPMs because of the risk of self disconnection – which is a concern I completely share – then what is the answer? If you leave them on credit when they can’t pay their energy, that’s just going to spiral into more debt and associated anxiety and mental health issues. No one wants that either.”

Crabb added: “I would put it back to Ofgem and ask should suppliers be required to do an evaluation of someone’s risk of self-disconnection. The key question is whether it is safe and practical to do that.”

He said it was important that the sector does not lose control of the narrative on this issue thus inflicting further damage to perceptions of smart meters more generally.

Year 3 of the Vulnerability Commitment will see suppliers quizzed further on whether they have the right controls in place around smart meter mode switches, as well as data-gathering on the number of court orders issued to defaulting customers.

Other areas of focus for the third year of the commitment, which currently covers 12 suppliers serving 80% of British households, includes digital accessibility. Suppliers will be asked about the processes they have in place to understand a customer’s digital experience and whether they are using that to drive continuous improvements to accessibility of their services.

Crabb said he expects suppliers to be more innovative in the communication channels they are utilising in 2023, having noted the slow pace of this work last year.

However, he cautioned against making assumptions on how different generations and customer types prefer to communicate – pointing to recent research that showed peak use of telephone calls at 75-plus but also between 16 and 24. Conversely he highlighted that customers with mental health issues often find it less stressful to engage with web chat as opposed to speaking to someone over the phone.

During 2022, three members of the Vulnerability Commitment were picked out for initiatives in relation to three key themes:

• Identification of vulnerable customers: EDF was recognised for its use of multiple sources of data that allowed it to pinpoint people who find themselves in a vulnerable situation and provide them with tailored support packages.
• Payment support: British Gas was commended for the British Gas Energy Trust (BGET) – an independent charity funded solely by British Gas but open to customers of any supplier. Since Winter 2021, £25 million has been given to the initiative. This year, British Gas also committed to donating 10% of its operating profits to the Trust for the duration of the energy crisis.
• Frontline staff training: Ovo Energy was praised for the creation of its “Vulnerability Academy”, which offers specific training and guidance for customer-facing teams to help them recognise, record and best support vulnerable customers. This training included a bespoke cost-of-living training by the Money Advice Trust, as well as mental health support and a fraud awareness course.