Centrica (LSE:CNA) said it will pay £20m into Ofgem’s Voluntary Redress Fund, carry out a comprehensive review of legacy prepayment meter activity and write off up to £70m of customer energy debt for vulnerable customers.
The action resolves Ofgem's investigation into British Gas Trading Limited's installation of prepayment meters under warrant covering February 2018 to February 2023, and follows steps taken in 2023 to stop involuntary installations and change field debt recovery practices.
"What happened should never have happened, and I am sorry to the prepayment customers who were affected," said Chris O'Shea, Group Chief Executive.
British Gas, the company's wholly owned subsidiary, will provide compensation for affected customers for 2018-21 in addition to payments already made for 2022-23, and a proportion of the debt write-off may be used as compensation.
Customers do not need to take any action and, where applicable, will be contacted directly by British Gas.
British Gas paused warrant-based involuntary prepayment meter installations for residential customers in early 2023 and has not restarted them.
The company will establish a 24-month British Gas Vulnerable Energy Customers Debt Advisory Panel including independent experts to develop improved practices for vulnerable customers in debt.
Centrica said it does not anticipate any impact to its 2026 financial guidance as set out in its preliminary results and recent trading statement.
