The energy regulator Ofgem has imposed a £20 million fine on British Gas for its mishandling of prepayment meter installations, a penalty that reflects the systemic failures in the company's debt recovery practices. This follows a months-long investigation into the forced fitting of prepayment meters in vulnerable households without adequate safeguards, a practice that the regulator has described as 'unacceptable'.
Under Ofgem's rules, energy suppliers must follow strict protocols before installing a prepayment meter, particularly for customers with health conditions or other vulnerabilities. The investigation found that British Gas had failed to conduct proper assessments and had installed meters in homes where it was not appropriate, sometimes leaving families without heating or power at critical times. The £20m penalty will be paid into a fund for affected customers.
Dr Helena Vance, Science & Climate Correspondent: The broader context here is the energy crisis that has seen household bills double in two years. Prepayment meters are a symptom of a system where energy debt has become a tool for corporate profit rather than a safety net. The physics of energy consumption are simple: when you can't afford to heat a home, you freeze. British Gas's actions accelerated that process for thousands. The fine is a small corrective, but it does not reverse the damage done to public trust.
British Gas has accepted the findings and apologised, committing to review its debt collection processes. The company will also compensate affected customers directly. However, critics argue that the fine represents less than 0.1% of the company's annual revenue and question whether it is a sufficient deterrent.
The regulator has meanwhile announced a wider review of prepayment meter practices across all suppliers, with new rules expected to be enforced later this year. For a country heading into another winter with energy prices still 30% above pre-crisis levels, the message is clear: the sector must prioritise human welfare over shareholder returns.
This incident also highlights a deeper issue in the energy transition. As we electrify our heating and shift to renewables, the grid becomes more central to daily life. If companies can cut off households because of debt, the entire project of decarbonisation risks being undermined by social inequity. The physics of climate change demand rapid electrification. But that transition will fail if it leaves vulnerable populations freezing in the dark.
The fine is a step. But the real test will be whether the energy regulator can enforce compliance that prevents such scandals from recurring, especially as energy prices remain stubbornly high. For now, British Gas has been told to clean up its act, or face consequences that go beyond a headline-grabbing penalty.
