The Prepayment Meter Price Cap came into force on 1 April 2017. The cap is temporary, and applies to prepayment meter customers on a non-fixed deal and without an interoperable smart meter. Suppliers can price to the level of the cap or below it, but cannot charge more.
A separate price cap applies to customers on a standard variable or default energy tariff. See Default Tariff Price Cap.
Before the Default Tariff price cap applied on 1 January 2019, and from February 2018, customers on a standard variable or default energy tariff and who received the government’s Warm Home Discount were price protected at the level of the prepayment meter price cap (sometimes referred to as the ‘safeguard tariff’).
When is the prepayment meter cap updated?
Ofgem adjusts the level of the cap twice a year – in February and August to apply in April and October respectively – to reflect the estimated costs of supplying electricity and gas to homes in the next six-month summer or winter period.
In August we will publish the details for the six-month winter prepayment price cap period which begins on 1 October.
Industry guidance on applying the prepayment price cap
- Prepayment price cap 1 April 2019 to 30 September 2019. Includes levels for current restricted charging period and cost allowance methodologies.
- Reporting template and FAQs. Compliance template suppliers must complete for each reporting period of the cap, alongside answers to common questions.
When will the prepayment meter cap end?
The cap is due to end at the end of 2020. We will continue to monitor the energy market closely while the prepayment meter cap is in place and produce an annual report on the competitiveness of the energy market.
- Implementation of the CMA remedies. Information on the Competition and Markets Authority (CMA) investigation into the energy market and recommendations for Ofgem to act, including those relating to prepayment meters.
Further publications and outputs relating to the prepayment meter price cap can be found in the publications feed at the foot of this page.
If you have technical or policy questions about the cap, please contact us at PPM.PriceCap@ofgem.gov.uk
If you are an energy customer looking to find out your capped tariff price, please contact your energy supplier. You can find their contact information on an energy bill, or see Who is my energy supplier? You can also find answers to frequently asked questions on our consumer FAQ page, or see our energy price caps guide.