Energy Companies Gaming Poverty

People in poverty will have a pre-pay energy meter. At some point — probably within the first week of installation — they will start to use emergency credit. The energy company may give them £6 of emergency credit.

When this is used up and their energy is switched off — they may buy £10 of energy. For each day something like 26p daily charge will be deducted. Let’s just say 26p for 1 day to make it easy to calculate. But they may also owe £100s of pounds in debt.

So £6 owed emergency credit
£3.50 for debt 
£0.26 p for daily charge

£ 10 paid on.

So the sum is £10 - £ 6 - £3.50 -£0.26 = £0.24p for energy from £10 paid.

Now you might assume they will have £6 of emergency credit again. But energy companies play games with people. They may decide to give them just £2.40 of emergency credit.

So for £10 they may have £2.64 of energy to use.

The energy companies play games with the emergency credit level for people in poverty to prevent them staying within emergency credit without paying their outstanding debt.

Imagine if banks operated a variable overdraft — so depending on how much you take out or pay in each day the bank overdraft changes. It would lead to highly chaotic lives. But that is the sort of chaos forced onto people in poverty by energy providers — determined to take back the debt from the poorest in society by varying the amount of emergency credit provided.

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