Ofgem is proposing to introduce a new requirement on suppliers to identify customers who are self-disconnecting and self-rationing and provide appropriate support.
The regulator says it is concerned about the number of customers self-disconnecting each year and the “significant negative impacts” this can have on them, particularly those in vulnerable circumstances.
Self-disconnecting is defined as interruption to electricity or gas supply by consumers using pre-payment meters (PPMs) because of a lack credit on the meter or account.
Self-rationing meanwhile means customers limit their energy usage in order to save money.
Ofgem believes that through regular monitoring and subsequent identification, suppliers should be able to take the most appropriate approach to support their customers.
Furthermore, the energy regulator proposes to formalise “emergency, friendly and discretionary credit” by suppliers for those who experience a sudden temporary change in circumstances.
Additionally Ofgem proposes incorporating the ability to pay principles, outlined in the 2010 debt review report, within the supply licence condition.
While there is currently no obligation on companies prohibiting gas and electricity disconnections, excect in certain circumstances, Ofgem believes disconnection due to debt should only be considered as a “very last resort” by suppliers.
It added that disconnections due to debt are now very infrequent and as such, it is not currently proposing to prohibit all disconnections but will keep it as an option should it be required.
Ofgem is consulting on its proposals, with responses to be recorded no later than 20 September. A statutory consultation will then be opened and a decision is expected in early 2020.
Last year Citizens Advice called on the government and energy suppliers to do more to reduce the impact of self-disconnection on vulnerable customers.
Gillian Guy, chief executive at Citizens Advice, said: “It unacceptable that so many vulnerable households are being left without heat and light.
“For some people self-disconnection is easily managed, but for many others it is an extremely stressful experience that can have harmful physical and emotional effects.”