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industry & Government news

ENERGY PRICE CAP EXTENDED

UNTIL END OF 2021

OFGEM’S ENERGY PRICE cap has been on default tariffs will also come under THE CAP EXTENSION WAS
extended until the end of 2021 in a move the protection of the cap from January, RECOMMENDED BY OFGEM IN AUGUST
the government claims will see around after the Competition and Market
11 million households across the UK Authority’s prepayment meter cap Under the new rules, suppliers have
make savings on their energy bills. expires at the end of 2020. to offer emergency credit to prepayment
The energy price cap aims to protect Business and Energy Secretary Alok customers who find it difficult to top up
less engaged customers such as the Sharma said: “The energy price cap has because of a mobility issue, self-isolation
elderly and most vulnerable from being been vital in ensuring customers do or a temporary inability to afford it.
charged excessive prices – it is thought to not pay too much on their bills, which Energy suppliers will also have to offer
have saved customers around £1 billion is why we are keeping it in place for at extra prepayment credit for vulnerable
a year since its introduction in January least another year. households, a move that could offer
2019, according to Energy Live News. “Switching energy supplier to find them extra space while working out
This is equivalent to around £75-100 the best value deals is still the best way alternative arrangements to pay.
a year for typical households on default to save on bills, but this government is These requirements aim to decrease
energy tariffs. determined to make sure all customers the number of prepayment customers
The cap extension was are treated fairly and get the protection who go without energy or self-disconnect
recommended by Ofgem in August they deserve.” after running out of credit on their meter.
following a review of the energy Additionally, Ofgem has announced a The regulator will also require
market and the impacts of coronavirus. series of new rules for energy suppliers suppliers from 15 December to put
An additional four million in a bid to protect customers who are customers in debt on realistic and
households with prepayment meters struggling to pay their energy bills. sustainable repayment plans.

ENERGY SMART METER INSTALLATION in homes were being used in dumb
Around 4.1 million smart meters
ROLL-OUT FACES FURTHER SETBACKS mode on 30 June, although customers
switching is just one reason for this.
To fix the problem of first-generation
SMART METERS to take all reasonable steps to install meters going dumb if you switch
HELP customers them in homes and small businesses energy supplier, first-generation
to manage their has been extended by six months from meters are being remotely connected
energy use by 31 December to 30 June 2021. to a central wireless network.
telling them in real Those who already have a first- This allows smart meters to
time how much generation smart meter fitted may feel communicate with all suppliers, so meters
they are using and saving them the particularly frustrated. being used without their smart features
hassle of submitting meter readings. First-generation meters often lose can become smart again and switching
But early adopters of the technology their smart functionality – including the won’t make a smart meter dumb.
may have to wait until the end of 2021 ability to automatically submit meter This began in July 2019 and will
for a fix that stops many smart meters readings – if you switch energy supplier. continue throughout 2020 and 2021.
going ‘dumb’ when they switch energy The government has quietly extended As of 20 October, only around 1.6
supplier, according to consumer the deadline for all first-generation million smart meters in homes and
watchdog Which? meters to be fixed by a full year – from businesses have been connected,
There are around 20.5 million gas the end of 2020 to the end of 2021. which means there could be more than
and electricity smart meters installed Before the roll-out began, the 14 million still to be upgraded.
in homes, according to the latest government set standards for smart In 2018, energy suppliers started
government figures – but installation meters to ensure they all had similar installing second-generation meters,
rates dropped significantly due to the functionality. The first type to be which are connected to the network at
coronavirus pandemic. installed – known as ‘first-generation’ the point of installation.
Most providers paused all but meters – make up the vast majority of This is now the default option
urgent installations in late March and, the smart meters fitted so far. and suppliers should no longer be
although they restarted from mid-May Estimates suggest there are around installing first-generation models.
with safety measures in place, they 16.1 million in our homes. However, British Gas told Which? in September
were unable to make up the shortfall. while they have similar functionality, that it has installed 6.5 million first-
Just 135,000 smart meters were fitted not all first-generation smart meters generation meters out of a total of 7.5
during April to June 2020, compared can be operated by all energy million, while Eon and Npower (both
with 985,000 in the previous three suppliers, which risks them going part of the Eon Group) have installed 2
months, and the deadline for suppliers ‘dumb’ if you switch. million out of 3.5 million in total.

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