Labour pledges to scrap ‘outrageous’ premium for energy prepayment meters

theguardian.com:

Labour has said it would eliminate the “premium” that means people with energy prepayment meters, who are often on low incomes, are charged more than those on direct debits.

About 4 million domestic customers use prepayment meters, and their price cap is about 2% higher than for direct debit customers, according to figures from Ofgem.

Prepayment customers would pay about £84 more than direct debit customers in the October to December quarter, and £100 more in the January to March quarter if the prepayment price cap continued to be set at current levels.

Rachel Reeves, the shadow chancellor, said: “It’s outrageous that people on prepayment meters have to pay more for their energy. Why should those with the least have to pay more to heat their homes and put the lights on? This is unjustifiable and morally wrong.

“As energy prices spiral, this unfair prepayment premium must end. Labour would make sure that no one pays over the odds for the same gas and electricity that everyone else gets, as well as taking broader action to help people manage their bills over the winter.”

The party said it would eliminate the gap between the two price caps over the winter and reimburse energy companies for the difference, which it said would cost about £113m between October and March.

The announcement is the first strand of what the party has promised will be a “fuller package” on the energy crisis that Reeves has been working on with Keir Starmer and that will be rolled out in the coming days.

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The shadow energy secretary, Ed Miliband, has also been involved in the work, which will be published ahead of the 26 August