Disconnections & Reconnections - June 2011 Quarter

The Commission places strong emphasis on monitoring the level of consumer accessibility to energy services. The level of energy disconnections for non-payment and reconnections in the same name are potential indicators of the ability of consumers to pay their gas and electricity bills.

Figures 1 and 2 show for recent quarters, the level of residential electricity and gas disconnections respectively for failure to pay bills and the level of reconnection in the same name and same premises within seven days of disconnection.

Given the market shares held by AGL SA (electricity) and Origin Energy (gas), both retailers exert a strong influence on the overall results. The Commission notes that the level of residential electricity disconnections per 100 customers in the June quarter 2011 has further increased from that experienced in the March 2011 quarter. In relation to gas; there was a decrease in the level of residential gas disconnections.

While it is not possible to clearly differentiate residential energy customers that are facing financial difficulties from those that are financially viable yet unwilling to pay their energy bills, there is an ongoing need for energy retailers to keep their credit management policies under review and to consider introducing greater flexibility in payment arrangements for consumers experiencing genuine financial hardship.

It is essential for consumers experiencing genuine financial hardship to have continued access to energy; the hardship assistance programs offered by energy retailers are very important in this regard.

The Commission will continue to monitor the energy retail market and to liaise with energy retailers on these issues to promote continuity of energy supply and a low incidence of energy disconnections.

Further analysis of hardship indicators will be undertaken for the 2010/11 Annual Performance Report, which is to be released in November this year.