Question to the Department for Business, Energy and Industrial Strategy:

To ask the Secretary of State for Business, Energy and Industrial Strategy, what discussions he has had with (a) Ofgem, (b) energy companies, (c) consumer organisations, (d) organisations advocating against fuel poverty, (e) organisations which advocate on behalf of older people and (f) other relevant stakeholders on setting a limit to the extra charges, in addition to the regular bill, which can be levied by energy companies on the bills of non-direct debit customers who pay by cash, cheque or over the phone.

Ministers and officials regularly meet with a wide range of organisations on issues relating to the energy retail market.

Suppliers incur additional costs when serving standard credit customers compared to direct debit customers, for example through additional working capital costs and administrative costs. Rules set by Ofgem mean suppliers can only charge more for one payment method than another if the price differential is cost reflective.

There are different cap levels for customers using different payment methods. This is calculated by Ofgem applying different ‘payment method uplifts’ to the benchmark of how much it costs a supplier to supply energy.