Energy companies have come in for more criticism over their pricing policies.
Some of the biggest profits enjoyed by gas and electricity suppliers are generated through low-income families, it has been claimed. The watchdog Consumer Focus has accused energy firms of making over £500 million a year extra from customers on pre-payment meters, many of whom are society's poorest and most vulnerable, the BBC reports.
It claimed the money raised through pre-payment meters is used to subsidise cheaper deals for other customers - for example those who pay by direct debit or opt for online tariffs. Last month, an investigation by the industry regulator Ofgem concluded that customers who pay for their energy using pre-payment meters are missing out on some of the most competitive deals.
Consumer Focus spokesman Jonathan Stearn said: "Companies could be making up to £550 million a year from extra charges they charge on prepayment meters. The energy companies are making the most money out of those on prepayment meters and often those are the people on the very lowest incomes."
Around 1,000 customers are being put onto prepayment meters every day and the Energy Retail Association claims many households are happy to pay for their gas and electricity in this way because it helps them to budget. But critics argue that some customers are being forced onto prepayment meters after getting into debt over energy bills.
Compare Gas & Electricity Suppliers via money.co.uk
