MSE News: British Gas to pay compensation and debt write-offs to those forced onto prepayment meters

MSE_Abby

If you had a prepayment meter forcibly installed by British Gas, you could be entitled to compensation and/or an energy debt write-off. The energy supplier has agreed today (Friday 15 May) to pay out £70 million in compensation and write-offs following an extensive investigation by the regulator…

https://www.moneysavingexpert.com/news/2026/05/british-gas-prepayment-meter-compensation/

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MrTrendingsheet

£70m sounds chunky until you put it next to Centrica's profits, which were £2.7bn in the year a lot of this was happening. So roughly a fortnight of profit for years of forcing meters into vulnerable people's homes.

The thing that bothers me is it's a "settlement" not a fine. Ofgem had to get a law firm in to do the investigation because they couldn't really do it themselves, and the result is essentially British Gas agreeing to pay back some of what they should never have taken. There's no individual on the hook, no director sanction, nothing that changes the maths next time. If you're a supplier weighing up the cost of being aggressive on warrants vs the cost of getting caught, this kind of outcome doesn't really shift the answer.

For anyone reading who thinks they're affected, worth checking the MSE guide carefully because some of the redress is automatic and some you have to claim, and the dates are tighter than the headlines suggest.

Ildhund

A couple of comments:

We have to remember that at the time these forced installations of prepayment meters was going on, the tariffs were significantly higher for prepayment customers than for those who paid by Direct Debit. This was one of the principal reasons for the public outrage at the practice. That difference was eliminated a couple of years ago, and prepayment is now in many cases the cheapest option. That reason for objecting to the forced installation of a prepayment meter no longer exists.

It is claimed that the victims of this practice were vulnerable. I wonder if this was general, because I'm sure many of those who don't pay their gas bill are simply taking advantage of the fact that they can get away with it for a long time and possibly end up not having to pay at all. If you don't pay your rent, you're evicted from your home. If you don't pay your phone bill, the phone is cut off. Council tax avoiders soon have bailiffs on the doorstep. Why should energy companies be denied this simple way of securing their revenue?

Why should those who don't live beyond their means have to pay higher energy bills to cover the debts of those who do?

Qyburn

It is claimed that the victims of this practice were vulnerable.

Certainly some aren't, two of those I saw crowing about this on a conspiracy theory site had prepay meters fitted after they'd been caught meter tampering.

TroubledTarts

I suspect a lot of the so called "victims" just didn't have the capacity to budget and therefore pre payment was the best thing for them to focus on the weekly amount of energy needed.

The extra cost of energy through pre payment at that time was the issue and they rightly deserve that difference back.

There will always be those that never intended paying so for them to get compensation is not ideal but the process of weeding them out is just too much of an administrative cost.

Qyburn

Personally I don't understand why those found meter tampering and stealing gas or electricity aren't being prosecuted instead of being treated the same as people who've just not paid.

Ildhund

At the end of the day, taking and using something without paying for it is usually a crime. We see every day cases of 'dine and dash' and bilking at petrol stations (officially 'Making Off Without Paying', MOWP). Regulations recognize the essential nature of an energy supply, even essential for life in some situations, and enjoin suppliers to jump through all sorts of hoops before resorting to prosecution. Sadly, I expect that some of those about to have their debt written off and compensation paid will be laughing all the way to the pub.

Financial assistance to the needy should really be within the purview of government and volunteer organizations, not energy suppliers and customers. That said, I don't mind paying a few bob extra on the electricity bill to make sure those who need it get a welcome leg-up in the winter.

MarzipanCrumble

Note: this also hits the customers who cut back and do without in order to pay their utility bills. And, yes, they may not be claiming what they could/should but their mindset is to pay what they owe.

So unfair that those who try it on get away with it.

Chrysalis

I agree with multiple points raised in the thread.

MrTrending's point is valid in my opinion, Ofgem just reacting to bad press, and then showing they incapable by having to hire outside help, and the resolution is effectively a slap on the wrist, just pay back some money owed. Thats not a deterrent. Its a bit like telling a burgler, just return most of what you stole, and you can carry on life as normal tomorrow.

I also agree with other points made, if people got into this position by tampering with the meter and getting caught, they should be prosecuted and perhaps waive rights to this compensation.

Marzipan is of course right there will be people struggling but have adjusted their priorities so bills get paid, I feel energy debt write off should be done on the basis the people in the predicament really had no options, rather than they chose to pay for a holiday instead of paying for their electric. The problem with doing it as a blanket, isnt just the increased cost but it normalises the behaviour of not paying deliberately knowing a write off comes later.

Scot_39

The fine above was presumably for the volume of improperly raised - against old guidance on vulnerability assesment.

But you also have to ask whether UKs energy policy, and in particular its high electricity cost isnt a major contributor to the UKs £4.55bn household energy debt (as of Q4 25 Ofgems combined 90 day arrears and debt in repayment figure).

As govts past and present continue to load more costs onto domestic bills, social policy like eco or its predecessors, whd, renewables and new networks to serve them etc.

And the cost to us of that debt - not so much a few bob in the minds of many of the poor struggling with bills (upto 12.1m homes) - was £50 ex vat in the cap in July 2025, And late last year Ofgem were also looking at the first 2 phases of additional debt write off charges

The recent budget £150 shift to taxation - probably came for some as a shock as to how much extra has been being added and I suspect many equally unaware of for just how long.

And despite the £130 ex vat drop in tge Ofgem cap policy line, that was £236 ex vat, £106 ex VAT still remains.

Like £92 for the Renewables Obligation RO 75% shift a scheme started in 2002, last award c2017, subsidies run for 20 years, so some payments continue to 2037.

All electric cap for 100% RO and ECO had a total of c£170 pa in PC2 cap of £1179 in Oct, £1229 in Jan - an average of 14%.

Then there are other costs like WHD, the debt £50 DRC as well too.

And then there is the other reason uk electricity is so expensive - renewables curtailment and balancing - which even NESO widely puts at c£2.0 bn pa currently (and for future debt levels concern is increasing sharply on way to £8bn+ by 2030/2031). And the £10-15bn pa on GRID network upgrade costs (say financed and depricated over 20 yrs at 5% by TNOs)

A couple of years ago - old NGESO figure put total balancing at an average c£40 per household trough before renewables started to reverse c10% market operational efficiciency gains. Again 100% on electric.

And so adding all of these costs up - easy to see well over £200 added to electricity bill at PC2 tdcv cap levels. And likely even dual fuel users at lower 2700kWh cap

And when look at Ofgem arrears and debt figures - which have clearly taken off in last 4 years just pre and worse post Ukraine invasion

https://www.ofgem.gov.uk/data/debt-and-arrears-indicators/

Ave electricty debt levels with no repayment plan jumped from £905 in Q4 21 to £1773 in Q4 2025 - £870 in 4 years.

Take out say £200 pa - and you have to ask yourself - what impact that would have had on ever growing energy bill debt / arrears.

And looking at the even lower £ ave figures for those in/on existing debt repayment plans - perhaps an even larger share of their debt - or I suspect in many cases it would not exist at all - at the long term average far lower energy bill costs.

And although the govt now helps more homes with WHD, around 6.1m - some UK energy and poverty groups estimate near double that number 12.1m homes struggling with their energy costs.

The UK energy market - and bills - needs rewiring on so many levels.

Wholesale costs, here we are over 4 years after Ukraine invasion / energy crisis and we still havent decoupled other generators from gas.

So we have a threat to try to partially recover excess profits from some instead - a tweak to Energy Generator Levy presumably - 45% to 55% rate from July - but thats only on profits from sale above a £75+ indexing threshold and for larger generators.

[It did raise £1.2bn in 23/24 - but at far far higher then than currently predicted gas and so electric pricing (the raw Ofgem market rate cap went over £4200 Jan 23, for 3m and over £3200 for next 3m - before dropping back c£2000 - the July 2026 forecast still sub £2000).]

But which of course doesnt in itself lower our electricity bills.

And for our bills over the last 3 caps alone govt and Ofgem have added £152 more in costs - budget moved a lower c£131 at tdcvs to tax - so in reality govt/Ofgem set energy costs still £20 higher in dual fuel cap - and bills would be if all else - e.g. direct energy and supplier operating costs - had been constant.

The public have tolerated these additional costs and structural inefficiences for too long - as uk energy been largely affordable for majority.

There is a lot less willingness to do so now. And even the current predicted July cap level spike - is again focussing eyes on the problems.