Firms want to retain customers to ensure they pay off debts

From 2 February, gas and electricity customers on a prepayment meter who owe less than �100 can switch supplier.

Debt is often used by firms to prevent customers from transferring supplier, a process known as "debt-blocking".

The regulator, Ofgem, has said up to a million customers may benefit from the new industry-wide agreement by cutting their household bills.

Helping poorer customers

Ofgem's Managing Director of Customers and Supply, John Neilson, said: "Now some of the most vulnerable customers will be able to enjoy the benefits of switching to a better deal and save money on their bills."

With the average debt of �150 many thousands of consumers would still be blocked Energywatch spokesman

People on prepayment meters are often paying more for their electricity and gas than customers who are billed for energy after using it.

Energywatch, the energy consumer watchdog, said the new rules may help people reduce their debts.

However, it said it would continue to press for the �100 limit to be increased.

A spokesman from the group said: "We welcome the lightening of rules on debt-blocking for prepayment meter consumers as a first step.

"But with the average debt of �150 many thousands of consumers would still be blocked from switching to a supplier of their choice."