Major energy retailers pledge to defer bills and disconnections

Energy retailers to defer bills and disconnections

The Coronavirus lockdown has caused huge job losses so the Australian Energy Regulator (AER) has called on energy retailers to put customers first. The AER want energy retailers to defer bills and disconnections for those in financial stress.

AER Chair, Clare Savage said that energy retailers are expected to act according to the magnitude of a crisis. “We understand the significant impact the COVID-19 pandemic is having on the Australian community. As a result, their energy use and ability to pay their bills could be affected.”

Ms Savage said that energy businesses operate as part of the community, and bear the weight of community expectations. “People enter into a contract when they sign up with an energy retailer. But businesses also have a deal, a social contract, with the community in which they operate. At a time like this, it is vital they remember their broader social obligations.”

What we can expect

While not calling for an amnesty on energy bills, the national energy regulator has been very clear in their expectations.
These include:

  • that energy retailers offer payment plans or hardship arrangements to all residential and small business customers who indicate they may be in financial stress. This should be regardless of whether the customer meets the ‘usual’ criteria for that assistance;
  • no disconnection of any residential or small business customers who may be in financial stress (without their agreement) before July 31 2020 and potentially beyond;
  • deferring referrals of customers to debt collection agencies for recovery actions, or credit default listing until at least July 31 2020; and
  • waiving disconnection, reconnection and/or contract break fees for small businesses that have ceased operation, along with daily supply charges to retailers, during any period of disconnection until at least July 31 2020.

The Big Retailers step up

The big three retailers have unveiled promises to provide additional support to cash strapped households and business.

Today, the CEO of AGL said the energy retailer would allow customers the opportunity to defer energy bill payments until July 31, under a new program to be fast-tracked.

Rival retailer Origin Energy has also promised that they would not disconnect residential and small business customers facing financial stress until at least July 31. At the same time, Origin has placed late payment fees on hold.

Leading energy retailer, EnergyAustralia, has also reaffirmed its commitment to customers doing it tough during the Coronavirus crisis in Australia. While not specifically addressing the new expectations in a statement released today, Chief Customer Officer Mark Collette said that EnergyAustralia is already helping customers through this difficult period – but customers need a whole-of-industry response.

In response, Ms Savage said, “We are pleased to see a number of businesses have already made announcements indicating they will be meeting these expectations. However we will be monitoring the whole market to ensure all customers are properly protected.

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