How to handle your energy bills when you can’t afford to pay

Origin Energy fined for failing to provide financial hardship assistance.

Origin fails those in hardship

Origin Energy has paid penalties of $40,000 relating to its alleged failure to provide hardship assistance to a residential customer, and its alleged wrongful disconnection of their premises in NSW in 2015.

The issue highlights the need for Australian energy consumers to understand their rights if they find themselves in financial hardship.

The retail law and retail rules (which apply in NSW, the ACT, Tasmania, Queensland and South Australia) set out key protections and obligations for energy customers and the retail and distribution businesses where they buy their energy.

The Australian Energy Regulator (AER), which issued the recent infringement notices to Origin Energy, monitors and enforces compliance with the retail law and the retail rules.

Under the National Energy Retail Law, a retailer must maintain and implement a customer hardship policy for its residential customers.

Hardship programs typically contain a range of support measures, including a ban on retailers disconnecting a hardship customer for non-payment if they are adhering to a payment plan.

The program’s purpose is to help them identify customers experiencing payment difficulties and help them better manage their energy bills.

At minimum, a retailer’s hardship policy must include:

  • processes to identify customers experiencing payment difficulties due to hardship;
  • processes for early response by the retailer;
  • offering of flexible payment options (including payment plans and Centrepay);
  • processes to identify appropriate concessions and financial counselling services;
  • processes to review customers’ market retail contracts; and
  • programs to assist customers in improving their energy efficiency.

The National Energy Retail Rules specifically outline the steps a retailer must take before it can disconnect a customer’s premises for non-payment.

Customers experiencing payment difficulties have a range of additional protections from disconnection, as under the retail rules if a customer is on a hardship program or is a residential customer adhering to a payment plan, they cannot be disconnected.

Disconnection of a customer’s premises for non-payment must be a last resort option for retailers. The AER encourages customers who are worried about paying their energy bill on time to contact their retailer as soon as possible.

Unfortunately, these hardship provisions are not always followed, as appears to be the case with this latest Origin infringement.

AER Chair Paula Conboy said the regulator was particularly concerned that even after the customer provided information to Origin about ongoing financial difficulties, and the same information was provided by a volunteer from a charitable organisation on the customer’s behalf, Origin failed to offer hardship assistance.

“Origin’s hardship policy states: ‘If we’re on the phone with a customer who seems to be experiencing hardship, we’ll transfer them to our Power On (hardship) team right away’. But the customer was never transferred to Origin’s hardship team or registered on the hardship program.

“It is not acceptable that a customer wanting, but struggling, to pay their bills is not given the assistance that is their right under the National Energy Retail Law,” Ms Conboy said.

It is also alleged that Origin failed to follow the proper process before disconnecting the customer’s premises for non-payment of his energy bill in November 2015.

In this case, Origin did not take into account the customer’s efforts to settle his debt, failed to offer the customer a payment plan arrangement, and failed to use its best endeavours to contact the customer before disconnection.

“Disconnection of a customer’s premises should be the last resort for retailers, especially for vulnerable customers. Protecting vulnerable customers is an ongoing priority for the AER and retailers who fail to adequately assist customers experiencing difficulties paying their energy bills, or disconnect vulnerable customers without following the proper process, may face enforcement action from the AER,” Ms Conboy said.

Has your energy provider ever threatened you with disconnection? How did you handle the situation?

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    COMMENTS

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    MjP
    21st Nov 2017
    11:11am
    It is a pity the penalty didn't include some recompense for the consumer.
    Rickrick
    21st Nov 2017
    11:58am
    It never does
    Anonymous
    21st Nov 2017
    3:14pm
    Ausgrid and the energy providers are thieving so-and-sos. The sooner all houses have their own solar panels and batteries, in order to become self-sufficient, the better. Then these gouging bums might go out of business. And governments should be transitioning to renewables mixed with nuclear power-sources.
    Old Geezer
    21st Nov 2017
    2:33pm
    No excuse if you can't pay your bills then they should cut of your electricity. What would happen if none of us paid our bills? There would be no electricity available to anyone.

    I'm sick of this nanny state where those who do the right thing are penalised by those who don't.
    Anonymous
    21st Nov 2017
    3:18pm
    I'm sick of OGs who lack compassion while ignoring the sky-high price of electricity. But I guess you'd have the elderly, pensioners and the poor freezing or boiling and groping around in the dark.

    Electricity is a must-have in our society, and should be affordable for everybody. This would be a just - not a "nanny" - state. Or do you want power only for the well-heeled?
    Kathleen
    21st Nov 2017
    3:19pm
    A bit heartless!
    Until you walk in another man’s shoes, DON’T JUDGE!
    Kathleen
    21st Nov 2017
    3:20pm
    No excuse if you can’t be nice!
    MjP
    21st Nov 2017
    4:18pm
    The issue OG is not with those who wilfully disregard their bills but with those who are having difficulties paying and try and get some assistance in managing payments, they intend to pay as they become able to.
    Old Geezer
    21st Nov 2017
    7:11pm
    Most don't have trouble paying for their electricity but pray on the fact that if they don't pay then they have money for luxuries instead. I've have death with these people so know how they operate.
    Kathleen
    21st Nov 2017
    3:25pm
    There is a government payment that provides $500 per bill for gas, electricity and water for those experiencing difficulties. The bill has to be unexpected or other unexpected expenses like washing machine breaking down, loss of job, etc. No other funds are available to pay the bill by the consumer like no bank balance.
    It is not advertised but an online search will find it.
    Old Geezer
    21st Nov 2017
    7:17pm
    It's for those people who think Christmas shopping is more important than paying their bills.
    H
    21st Nov 2017
    4:37pm
    The fact of the matter is that electricity, is a necessity and a basic needs commodity that should be provided to the people by their government at a fair and affordable price. The people who are not able to pay their power accounts are likely to be struggling across the board as governments fail to provide all basic needs commodities. Gas, water, electricity and indeed in this day and age NBN that is effective and affordable.
    I have never seen times like we live in. A govt that has absolutely no regard for its people, whether it be State or Fed.
    Basic living costs are going up daily, and yet the CPI refuses to budge? I heard the explanation the other day on the radio, that cpi is low because there has not been the increase in consumer goods????
    He went on to explain that whilst fuel increases, electricity increases, food stuffs increases and so on and so on. The price of mobile phones has dropped, the price of large led tv's has dropped and the price of high end electronics has dropped, and these price drops have negated the other rising costs of the other commodities and so the CPI remains low.

    The problem with that is, that the lower income families rely on the CPI for their pension rises and other Social Security payments. These folks don't buy high end electronics, LED tv panels, and iPhones every day, but they do need food, petrol, electricity and water, gas and so on EVERY day.

    So we do not really need a hardship policy but rather affordable every day commodities that consumers can AFFORD.
    Regards H
    Old Geezer
    21st Nov 2017
    7:23pm
    I haven't noticed an overall increase in my living expenses when I take everything into account for many years now. I was thinking the other day it actually costs me less today than it did 5 years ago. My electricity is cheaper, phone and internet cheaper, don't have mailing expenses as email takes care of that, my current car is more efficient and uses less fuel, groceries haven't increased etc.

    21st Nov 2017
    4:46pm
    Can one claim hardship for not paying rent, their mortgage, car payments, phone bills, credit card bills , groceries, petrol, ....
    What a strange concept
    Not knowing how to budget and live within your means is not hardship, its irrresponsibility
    Old Geezer
    21st Nov 2017
    7:19pm
    I've lost count of the number of people who have told me that they have done their Christmas shopping and there is little if anything available for their normal bills.

    That is not hardship.
    Anonymous
    21st Nov 2017
    7:23pm
    Aaah but OG - its this horrible governments fault for now increasing the OAP to allow for pensioners to buy gifts for their kids and grandkids

    I'm not kidding - someone actually had the gall to post that as an excuse for more pension, and a few bludgers actually agreed with him/her
    Old Geezer
    21st Nov 2017
    7:30pm
    I know a lady who works for a charity and she asked me if I'd like a hamper for Christmas. I said no it should go to someone else in need. She told me that most people they give hampers wouldn't need them if they managed their finances better as they have more than enough to live on and do a good Christmas as well.
    Kathleen
    21st Nov 2017
    7:33pm
    No, that does not work. It has to be genuine. Shopping is not an unexpected expense. An example would be needing something that cannot be done without like a stove or car repairs because you have a disability and need your car. You have had an operation and need a few things after surgery that are necessary. A special shoulder support that costs a few hundred dollars.
    If we lose our compassion we lose our humanity.
    Your bank account is checked to make sure you are actually short of funds.
    Anonymous
    21st Nov 2017
    7:48pm
    Dont confuse compassion for stupidity or gullibility Grandma

    There are certain bills you always pay first - rent , utilities and food.

    live in accommodation , consume utilities and food in moderation and in keeping with your income.

    checking the bank balance doesnt show anything.

    the irresponsible person may have spent it all unwisely
    Old Geezer
    21st Nov 2017
    7:48pm
    Many people have a low balance account just for that purpose. This is one of the oldest tricks in the book. People used to get free glasses when they showed their bank account with mere pennies in it. I have seen it being done nearly all my life.