British Gas has agreed to a £20 million payout and will compensate customers who had prepayment meters installed without their consent, regulator Ofgem has announced following an investigation.
The watchdog concluded that British Gas failed in its duty to protect vulnerable customers by forcibly fitting these energy meters into people’s homes in previous years.
The energy supplier is now set to compensate those affected between 2018 and 2021, building on payments already made to customers impacted during 2022-23.
As part of the agreement, British Gas will also write off up to £70 million in energy debt for vulnerable customers.
Individuals due compensation will be contacted by British Gas and do not need to take action.
Ofgem, which launched an investigation and changed the rules after the industry-wide practice was publicly exposed, said its probe into five-year-long policies and procedures had been one of the most complex in its history.
British Gas has agreed to a settlement in relation to its treatment of customers who had a prepayment meter (PPM) installed without their permission.
— Ofgem (@ofgem) May 15, 2026
Learn more about the investigation here: https://t.co/4ULwZ1nxnZ pic.twitter.com/cKbeJCIQFD
Tim Jarvis, the watchdog’s chief executive, said: “It is clear that British Gas fell short in its treatment of an unacceptable number of vulnerable customers who had a prepayment meter installed without consent, and it’s right that they’ve taken action to put things right.
“Because of our action, customers will receive a substantial package of redress, compensation and debt write off.”
He added: “The installation of prepayment meters under warrant should only be a last resort, with rigorous checks to ensure debt is recovered lawfully, proportionately and safely.”
Smart pay-as-you-go meters were a “positive choice for many customers”, according to the boss.
British Gas apologised to people affected by its actions and asserted that it has not been force-fitting prepayment meters since February 2023, when the issue was first exposed.
Chris O’Shea, group chief executive of British Gas owner Centrica, said: “What happened should never have happened, and I am sorry to the prepayment customers who were affected.
“When we get things wrong, we make them right.
“When these issues came to light in 2023, we apologised, stopped the activity immediately and took rapid action to improve our processes and change how we engage with customers in debt, particularly those in vulnerable situations.
“Over the last three years, we have treated this matter with the seriousness it deserves and have made changes to our practices and put safeguards in place to ensure we deliver the standards our customers have every right to expect.”
Some 40,000 customers who had a prepayment meter installed without their permission between 2022 and 2023 are already receiving compensation from suppliers, including EDF, E.On and Scottish Power.
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