Energy: Prices

House of Lords written question – answered on 14th January 2014.

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Photo of Baroness Bakewell of Hardington Mandeville Baroness Bakewell of Hardington Mandeville Liberal Democrat

To ask Her Majesty’s Government whether they have any plans to ensure that those who get their electricity through key meters do not have to pay more than those who pay by direct debit.

Photo of Baroness Verma Baroness Verma The Parliamentary Under-Secretary of State for Energy and Climate Change

Since 2010 prepayment meter customers have been offered the same prices by large supply companies as customers who pay quarterly bills on standard credit.

The cost of operating a prepayment meter is higher compared to a standard credit meter as it includes a requirement for suppliers to provide an emergency call out and replacement key/card services. We estimate that the cost difference between prepayment and direct debit customers is around £67 a year for gas, and £43 a year for electricity on average. This is less than 10% of the average total bill. Under the terms of their licence, suppliers are required to ensure that the cost of the different payment methods reflects the cost to the supplier, so they cannot spread the costs of servicing prepayment meters across their customer base.

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