A Fuel Poverty Action Group, supported by North Edinburgh Trust is today, Friday 6 February, launching a new campaign to highlight the injustice that sees low income households being forced to pay in excess of a third more for their gas and electricity than those who are better-off and in a position to take advantage of cheaper online energy deals. The Action Group will also be calling for areas with high numbers of pre-payment meters (ppms), such as North Edinburgh, to be given priority status when the national roll out of new smarter energy meters begins.

Many of the residents in the area served by the independent community-led Trust use ppms to pay for their gas and electricity. And while this pay-as-you-go method can help residents manage their household budgets they are harshly penalised for using ppms.

For example, Scottish Gas, whose corporate headquarters sit within the community, charges its local ppm customers £1368 a year for their gas and electricity - £314 more than it charges online customers who pay £1054. And ScottishPower is even worse, charging ppm customers £341 more than those with internet tariffs (£1333 compared to £992 each year).

Customers of the other big energy companies don't fare much better, Npower ppm customers pay £284 more, EDF ppm customers £197 more, EON ppm customers £131 more and Scottish Hydro ppm customers £127 more.

In contrast the Action Group points to the experience of ppm users in Northern Ireland who, as a result of the installation of new smarter user-friendly ppms, enjoy cheaper energy than customers who pay by direct debit.

The Group is calling on energy suppliers to bring prepayment prices down and into line with the cheapest deals. John Davidson, a campaigner from the Group, said: "It is scandalous that energy companies penalise their poorest customers by making them pay more. Common decency tells you that those least able to pay their bills should not be contributing more to energy company profits than better-off customers. Companies should drastically reduce their ppm prices now and if they won't do it then they should be made to.

"When you look at the impact of new smarter meters on prices in Northern Ireland it shows that ppm users needn't be treated like second class citizens. It's vital that areas with a high level of ppm usage are given top priority when the smarter meters begin to be installed here over the next few years."

The campaign is strongly supported by local MP Mark Lazarowicz and MSP Malcolm Chisholm. Mark Lazarowicz said: "Energy companies keep telling us how much more they are doing to help hard-pressed customers yet we know they are still making the poor may more through excessive ppm charges. The companies have been repeatedly warned by the Government at Westminster that they need to take action. I'll be seeking support from MPs across the House of Commons for a motion I have laid before Parliament and if the companies continue to fail to act then I'll be asking the industry regulator Ofgem, through its ongoing 'Unfair Pricing' inquiry, to force the companies to lower ppm prices."

Malcolm Chisholm MSP said: "We're experiencing one of the coldest winters in recent memory and almost every day I hear from local people just how difficult it is to keep feeding their gas and electricity meters. It is unacceptable for energy suppliers to make extra profits from their poorest customers and I am placing a motion before the Scottish Parliament calling for the companies to make fuel more affordable for ppm users and to demand that existing ppm users are the first to be given new smarter meters."

The North Edinburgh Fuel Poverty Action Group will launch the campaign at its inaugural Fuel Poverty Conference in the Prentice Centre, Granton, at 12.30am today. All are welcome to attend.

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For further information and to arrange interviews contact Graham Kerr of cambium on 07734 884405.

 
Notes to Editors
You are invited to send a reporter, photographer or film crew to the event where local people and politicians will be available to talk about the campaign. The campaign will be launched towards the end of the conference at 3pm.

The North Edinburgh Trust is a community development trust that aims to maximise community influence, address poverty and bring real economic and community benefits to the North Edinburgh area. Independent and community-led, the Trust supports community involvement and participation within North Edinburgh, and in particular within the neighbourhood partnership structures. In addition the Trust works closely with other agencies and stakeholders to help tackle the unacceptable levels of poverty that exist within North Edinburgh and improve the appeal and wealth of the local area.

Prepayment meter use is concentrated among consumers on low and fixed incomes:

-         36% of ppm users are unemployed
-         35% of ppm users are lone parents
-         32% of ppm users have a long term illness or disability
-         Consumers with an income below £25,000 are 5 times more likely
to use a ppm than consumers with an income above this level
-        ppm use most prevalent in social groups D and E

Text of Early Day Motion submitted to House of Commons by Mark Lazarowicz MP – "That this House welcomes the launch of the campaign by North Edinburgh Fuel Poverty Action Group calling for an end to the excessive prices paid for gas and electricity by pre-payment meter users; notes that PPMs are used predominantly by consumers on low and fixed incomes; believes it is unacceptable that a pre-payment meter user can pay up to £340 more each year than a customer using an online payment method; recognises this is an issue for low-income households across the United Kingdom; and calls on Ofgem to bring forward regulations at the earliest opportunity to end these punitive charges on the poorest in society; and further believes that if they fail to act the Government should introduce legislation to address the issue."

Text of Motion submitted to Scottish Parliament by Malcolm Chisholm MSP –

"That the Parliament welcomes the launch of the campaign by North Edinburgh Fuel Poverty Action Group calling for an end to the unjust practice by energy suppliers of charging customers using pre-payment meters more for their gas and electricity than customers paying by direct debit, or online; notes that in North Edinburgh a pre-payment meter user can pay up to £340 more each year than a customer using an online payment method and calls on all suppliers to take notice of the North Edinburgh campaign and reduce the price paid by PPM customers to that paid by direct debit customers or lower."

Energy supply companies argue that ppms are more expensive because of the costs of maintaining the network for these meters and payment outlets. However, Ofgem has estimated that additional costs are approximately £80 per year per customer.

The energy price differentials are based on current prices and an average annual consumption of 20500kwh (gas) and 3300kwh (electricity).