Electricity prepayment meter fraud update

Prepayment meter fraud - where criminals offer half price electricity top-ups to prepayment meter customers using cloned electronic £50 top-up keys - occured 88,300 times last year, according to figures from Energy UK.

At £25 per fake top-up, that would have cost suppliers around £2.2 million in lost revenues.

The body, which represents the interests of energy suppliers, said the industry had made significant progress addressing the problem in recent months and had spent tens of millions of pounds developing technological solutions and telling consumers not to use dodgy credit, and where to top up safely. These costs will be added to consumers bills.

Some of the technical solutions include developing meters which disable the cloned keys, although it is unclear how many of these have actually been installed nor how many customers have been made to pay twice for using fake top-up credit.

Energy UK said about 150,000 customers have been affected to date. Utility Week understands that the problem, which occurs in Itron prepayment meters, was first discovered in 2004 but reached a critical mass in 2010. Energy UK has previously told Utility Week that about 10 per cent of customers that use fake prepayment credit do so persistently. That would mean about 15,000 households are repeatedly using fake credit.

Presuming engineers could gain acces to those premises, and assuming a £200 total cost of new meter and a first time fit, taking those 15,000 households out of the equation might cost around £30 million.

Further reading:

Clone wars: what cost a fix?

Big six count the cost of PPM fraud

Prepayment fraud shows no sign of stopping