LONDON — One of the United Kingdom’s largest domestic energy suppliers has agreed to pay £20 million in compensation and customer credits after the energy regulator found that its contractors broke into the homes of vulnerable customers and force-fitted prepayment meters without proper legal authority, in what the watchdog called a serious and systematic abuse of the consumer protection rules that govern debt recovery in the regulated energy sector. The settlement, announced Thursday by the Office of Energy Markets, covers 14,200 affected households across England, Scotland, and Wales, and requires the company to fund a dedicated customer remediation team for a period of two years.
The regulator’s investigation, which began in early 2025 following a surge in complaints to the consumer helpline, found that Meridian Energy had authorised third-party debt-recovery agents to obtain court warrants for forced meter installation using incomplete and in some cases factually inaccurate information in sworn affidavits. In multiple documented cases, contractors then entered properties occupied by elderly residents living alone, individuals with serious medical conditions, and households with children under the age of five — all categories that are explicitly protected from prepayment meter force-fitting under the regulator’s vulnerability code of practice.
“What happened here was not a paperwork failure or an administrative oversight,” said Jocelyn Armah, chief executive of the Office of Energy Markets, at a press conference in London on Thursday. “Contractors acting on behalf of Meridian Energy entered people’s homes, overrode their heating controls, and left them on prepayment systems they could not afford to top up — in some cases in the depths of winter. That is unlawful conduct, and it caused real and measurable harm to real people.” Armah said the investigation had identified 43 cases in which households had subsequently lost heating for periods of more than 48 hours because they lacked the funds to load credit onto the newly installed meters. In six of those cases, medical professionals had subsequently documented cold-related health complications in elderly residents.
Internal documents obtained by investigators during the inquiry showed that Meridian Energy’s debt-management division had established monthly performance targets for the number of prepayment meter installations completed by contracted agents. Evidence presented to the regulator showed that bonus payments to contractors were structured in part around hitting those volumetric targets, creating a financial incentive to accelerate installations regardless of whether all the proper legal gateway conditions had been satisfied before the warrant was applied for. Meridian Energy disputed that characterisation in its formal response, arguing that the bonus structures were tied to overall debt-portfolio management outcomes rather than installation volumes specifically.
Consumer advocacy organisation FairPower UK, which had campaigned for a regulatory investigation for more than a year after receiving a wave of complaints from affected customers, welcomed the settlement but said the financial penalty was inadequate given the scale of the company’s profits. “Twenty million pounds sounds substantial until you consider that Meridian Energy posted pre-tax profits of £680 million in its most recent financial year,” said FairPower’s director, Constance Yeboah. “This settlement amounts to less than three percent of one year’s profit from a company that made those profits partly by breaking the rules that were designed to protect the most vulnerable people in its customer base. That is not a deterrent. That is a cost of doing business.” The group formally renewed its call for the regulator to pursue personal liability proceedings against the senior executives who had approved the debt-recovery programme and its associated contractor incentive arrangements.
Under the terms of the settlement, affected customers will receive an average credit of £940 applied directly to their energy accounts, rising to £1,400 for those in households where medical vulnerability had been formally recorded at the time of installation. Cash payments will be available to any customer who has since switched to a different energy supplier and therefore cannot receive an account credit. Meridian Energy must also remove prepayment meters from all affected properties at no cost to the customer and cannot refuse a return to credit billing on the grounds of outstanding debt for a period of 18 months. The company issued a statement saying it had already made significant changes to its debt-recovery processes and had terminated its commercial relationship with the principal agent firm involved in the installations.
The Office of Energy Markets said it was continuing to examine the practices of three other large energy suppliers that had employed similar contractors and similar warrant-application practices during the same period, and indicated that further enforcement actions could be announced before the end of the calendar year. The regulator also launched a consultation Thursday on tightening the rules governing warrant applications for prepayment meter installations, including a proposal to require independent legal review of all applications involving households that have been flagged as potentially vulnerable in supplier records. Parliamentary reaction was swift, with senior lawmakers on both sides of the house calling for a full inquiry into prepayment meter practices across the entire domestic energy sector and for a review of the adequacy of the financial penalties available to the regulator under its current statutory powers.