From 1 April 2017 the amount of money suppliers can charge a domestic prepayment meter (PPM) customer will be subject to a temporary price cap.
The key points of this are:
- Ofgem estimate that many prepayment customers are likely to see reductions in their gas bill of around 10-15% from 1 April 2017 or around £80 a year based on a typical household’s consumption
- The cap will initially apply to over four million households who prepay for their energy, with traditional prepayment meters and are amongst those least able to benefit from competition.
- The levels of the cap vary for electricity and gas, by meter type and region
- Ofgem will be administering the cap and the levels of the cap will be updated on 1 April and 1 October each year, where prices could go up or down or stay the same
- The cap is part of their work to deliver a more competitive, fairer and smarter energy market for all consumers
- It is due to expire at the end of 2020 when the Smart meter rollout is expected to be complete.