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Editor's Pick | BEIS announces new measures to protect PPM customers

Nick Palmer Nick Palmer Senior Writer
31st March 2020

This article is from issue 707 from Energy Spectrum written on the 23 March 2020. For up-to-date news and insight on the energy sector, find out more about the full weekly publication at the bottom of this article.

New measures are being introduced to protect prepayment meter (PPM) customers during the Covid-19 outbreak, BEIS announced on 19 March.

PPM customers, who may not be able to add credit can speak to their supplier about options to keep them supplied. This could include nominating a third party for credit top ups, having a discretionary fund added to their credit, or being sent a pre-loaded top up card so that their supply is not interrupted. BEIS said any energy customer in financial distress will also be supported by their supplier, which could include debt repayments and bill payments being reassessed, reduced or paused where necessary, while disconnection of credit meters will be completely suspended.

BEIS said there was an industry agreement signed by all UK domestic suppliers and it will come into force immediately.

Business Secretary Alok Sharma said: “While friends and family will play a role in helping people impacted by the Coronavirus, we recognise there will be many customers who will need additional support and reassurance, particularly those who are financially impacted or in vulnerable circumstances. The government has committed to do whatever it takes to get our nation through the impacts of this coronavirus pandemic. Today those most in need can rest assured that a secure supply of energy will continue to flow into their homes during this difficult time.”

The government and energy industry have agreed to prioritise those existing customers most in need, while identifying customers whose circumstances may have changed as a direct or indirect result of Covid-19.

Ofgem will continue to ensure suppliers meet their regulatory obligations. However, the government also “recognises this will be a challenging time for many supply businesses”.

BEIS highlighted the package of business support measures set out by Chancellor Rishi Sunak in the Budget. This includes £330bn for companies to access loans, a business rates holiday, and help for small firms without insurance. In addition, a new temporary Coronavirus Business Interruption Loan Scheme is to be launched to support businesses access £1bn of additional bank lending.

Energy UK Chief Executive Audrey Gallacher said: “These are extraordinary circumstances and the industry is working closely with the government on a daily basis to ensure there is no disruption to the generation and supply of energy to customers.”

Chief Executive of Citizens Advice Dame Gillian Guy said: “Keeping people on supply, making sure they have warm homes and don’t face additional financial or other stresses about their energy supply will be essential.”

Chief Executive of Energy Networks Association David Smith said: “These are unprecedented times, but the energy industry is working hard to keep gas and electricity flowing, look after our vulnerable customers and keep customers and staff safe. The UK’s electricity and gas network are one of the most reliable in the world and over 36,000 employees are working flat out to continue to provide a safe and reliable supply of energy during this time.”

Additionally, the Chancellor and Business Secretary a met on 18 March as part of a new Committee to address the economic and business issues presented by Covid-19.

The Committee discussed government support for businesses affected by Covid-19, including urgent progress on delivering the £12bn of measures to support businesses in last week’s Budget. The Committee agreed that further measures would be taken as the situation develops and agreed a reinforced effort to ensure that businesses are aware of support available to them and know how to access it. The Chancellor asked Cabinet Ministers to lead round tables with business groups, including in those sectors most directly affected. The Committee also discussed the importance of keeping under review regulations, and lightening their burden where possible, including in response to requests from business.

The Committee will continue to meet weekly, and more regularly as required.

This initiative is a result of rapid work across the industry to put principles in place to look after vulnerable customers. Suppliers in particular are concerned, not just about this measure but about cash flow in general in the coming months.

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Energy Spectrum is a weekly publication covering all of the key policy, regulatory, market and transactional developments across the energy sector. It offers a timely, insight-driven overview of the need-to-know news and changes in the energy sector. Contact the Editor, Nick Palmer to request a trial on 01603 604400 or click here.