Smart meters – the smart choice
Credit – Sky News – news.sky.com – 07 June 2019
The Competition and Markets Authority (CMA) wants to change the way it calculates the prepay price cap and it could also be extended beyond its previous end date of 2020.
The cap of £1,242 a year for the average home was introduced in April 2017 and is separate from the government’s price cap policy.
Those using prepayment meters, many of them due to poor credit history or debt, had been expecting to benefit from having smart meters.
But the CMA said the smart meter rollout had “not progressed in line with the initial projections”.
They added: “Evidence shows that it is not on track to complete by the end of 2020 and we believe may be as much as two years behind schedule.
“Consequently, there will be a significant proportion of prepayment customers without a smart meter at the time the [price cap] expires on 31 December 2020, when the roll-out was expected to be substantially complete.”
Offering prepay meters is more expensive for suppliers and experts have warned that homes with prepay meters could be the last to get smart meters.
The CMA said the price cap “is no longer effective in meeting all of its aims, due to underestimating the costs incurred by efficient suppliers”.
They added: “Some of the costs that an efficient supplier is expected to bear in supplying prepayment customers have increased to a level materially higher than that reflected in the [prepay cap] methodology.”
The CMA’s move to adjust the way it calculates the prepay price cap is provisional and it said it would consider comments and evidence from suppliers and customer groups before a final decision.