Octopus Energy’s prepayment practices save vulnerable customers nearly £7 million more than Ofgem’s policies

• Comes as Octopus challenges Ofgem’s “policy over people” approach
• New Ofgem ruling risks forcing Octopus to shift away from consumer-first strategy
• Octopus calls on Ofgem to return to principles-based regulations and prioritise bringing bills down for all by fixing the broken energy system

London, 8th July 2025 – Ofgem has spent two years investigating an alleged issue with prepayment meter bills that had zero customer complaints and had already channeled millions of pounds into customers' hands.

Ofgem asked Octopus to pay £1.5 million to prepayment customers who had not received ‘final bills’ and to change its billing policy to always issue a final bill for prepayment customers. Octopus has complied with both demands.

However, Ofgem’s ruling that prepayment customers must receive a final bill upon moving out – while sensible in principle – is impossible to implement in most cases, as:

• 60% of prepayment customers don't notify Octopus when they move. Most use up their remaining credit or leave it for the next tenant.
• Octopus – and other suppliers – rely on slow and unreliable traditional prepayment industry systems for final billing; the customer’s prepayment meter card is the source of information (prepay customers know their balance at all times as it's on the meter and is needed for top ups).
• Octopus only has bank account details for 10% of prepay customers, while 70% of refund cheques go uncashed due to a lack of forwarding addresses.
• Only 2% of prepay customers contact Octopus about final bills.

This means that under Ofgem’s rules, only about 16% of prepay customers would actually receive a final statement and any due credit refund.

Instead of following Ofgem's unrealistic final bill mandate based on unreliable data, Octopus charged prepay customers around £70 below the price cap (unlike other major suppliers), ensuring they are always better off regardless of their tenancy status.

Octopus also leaves any remaining credit on the meter for incoming tenants to use, recognising that outgoing tenants typically use up their credit before moving, or coordinate informally with the incoming tenants.

The company also writes off any debt on the meter when contacted by the incoming tenant.

Collectively, these policies saved customers over £7 million more than if the company had stuck to simply following Ofgem’s policies.

Octopus has focused on the things that matter for customers – keeping their bills down – not issuing a final bill that might be wrong and not chasing small amounts of debt from often vulnerable customers.

Rachel Fletcher, Director of Economics and Regulation at Octopus Energy, said: "Octopus has always been focused on doing the right thing for customers and thinking outside the box to deliver good outcomes for customers despite imperfect industry systems and data.

“With energy costs soaring, we’d like to see Ofgem put people over policies. People want lower bills. We’d like to see Ofgem focusing its efforts on delivering that.”

-ENDS-

Notes to editors:

Press Contacts

Octopus Energy Group

press@octoenergy.com

+44 (0)20 4530 8369

About Octopus Energy Group

Octopus Energy is a global clean energy tech business, driving the affordable, green energy system of the future. Under its own retail brand, Octopus delivers world-class customer service and cutting edge energy products to over 9 million households globally. Its operations span 32 countries and the entire energy value chain. The group invests in, builds and flexibly manages renewable energy, operating a £7 billion portfolio of projects.

Octopus has licensed its advanced data and machine learning platform, Kraken, to support over 60 million customer accounts worldwide through licensing deals with companies such as EDF, E.ON and Origin Energy. Kraken enables Octopus to drive the electrification of heat and transport through smart tariffs and innovative cleantech. Backed by pension funds, investors and energy giants, Octopus Energy Group businesses deliver cheaper, greener energy and cutting-edge tech to countries and customers worldwide. For more information, check out our website.