PPM customers will be ‘profoundly unimpressed’ with bill rebate

Alan Whitehead has raised concerns over whether pre-payment meter (PPM) customers will benefit from the government’s £200 electricity bill rebate, which he has branded a “scheme to lend customers their own money”.

During question time for ministers of the Department for Business, Energy and Industrial Strategy on Tuesday (22 February), the shadow energy minister told the House of Commons that the UK’s 4 million PPM customers will be “profoundly unimpressed” by the scheme, which is designed to soften the blow resulting from April’s looming 54% hike in the energy bill price cap.

As well as facing a price cap £46 higher than for all other customers, Whitehead said there are questions over whether PPM customers will even be able to receive the payment because they lack accounts.

He said: “It is uncertain whether they will have access to the £200 government scheme to lend customers their own money, as they do not have accounts through which to do this. Indeed, many of them will miss out on the council tax rebate, too.”

Whitehead said it would have been “much more straightforward and fairer” to take Labour’s proposal to levy a windfall tax on companies, which are profiting from high gas prices, and provide pre-payment customers with a “direct and non-refundable discount” through their meter.

Kwasi Kwarteng, secretary of state for business and energy, said the government is “working hard” to design the £200 discount scheme “at pace”,

But he acknowledged that delivering the bill reduction for pre-payment customers will require a “special focus” and that BEIS is engaging with consumer groups and Ofgem to work out how best to design the mechanism.

Speaking to Utility Week earlier this month, Fuel Bank Foundation chair Matt Cole warned that the recovery of the repayable rebate could give a financial shock to PPM customers when they go to top up their meter and said the discount should be provided to vulnerable customers as a grant.

Citizens Advice chief energy economist Rich Hall has also expressed concerns that the rebate could be unfairly recovered from customers who have not benefitted from it themselves due to the changing composition of households during the five-year repayment period.