Origin Energy has paid almost half a million dollars in penalties after disconnecting more than 300 customers in Victoria, allegedly without following the steps energy providers have to take to help customers struggling to pay their bills.
Victoria’s energy regulator issued Origin Energy with 90 penalty notices, adding up to $450,000 in total, after the retailer allegedly failed to alert 349 customers to its payment help options before disconnecting them – instead sending what the regulator described as a vague text as a final warning before disconnection.
The Essential Services Commission (ESC) claims the retailer failed to provide clear information about financial aid and payment assistance, which is a necessary step under Victoria’s payment difficulty framework, before disconnecting them.
Disconnections should only be used as a last resort for customers who aren’t meeting their payment requirements, ESC Commissioner Sitesh Bhojani said.
“Energy retailers must offer a range of assistance, including flexible payments or bill deferrals and information about relief grants and energy concessions that may be available,” he said.
The ESC said it had evidence that between 7 February 2019 and 13 February 2020, Origin wrongfully disconnected 263 electricity and 86 gas customers who were behind on their bills, many of whom reported receiving just a text as a final warning before their energy supply was disconnected.
Under the Energy Retail Code, retailers can not disconnect a customer for not paying a bill without using its ‘best endeavours to contact the customer’ first and ‘providing clear and unambiguous information about the assistance available’.
In Origin’s case, the ESC found that the final warning texts sent by the retailer failed to meet these requirements. And though Origin was quick to remedy the situation and co-operated well with the ESC, it was still disappointing that its policies weren’t up to scratch, Bhojani added.
“Origin were part of the development of our nation-leading payment difficulty framework and have acknowledged they fell short of the standard required,” he said.
Origin Energy has since compensated all affected customers at a total cost of $502,857, with compensation payments ranging from $4 to $24,000 per customer.
Communicating with customers was taken very seriously by the Origin team and the team was quick to identify, self-report and remedy the situation, Origin’s EGM Retail, Jon Briskin, said.
“Information about payment support options is an important part of communicating to customers around non-payment and, while the required information was provided to these customers in earlier communications, we regret these options were not reinforced in the final SMS sent to them after their disconnection warning notice,” he said.
“We identified this breach through our own processes and self-reported it to the regulator, and since then have apologised to and compensated the affected customers, and improved our processes and communications.
“We are very proud of how we support our customers, especially those in need of financial support, and encourage any customers in need of payment assistance to talk to us so we can provide appropriate support and protection from disconnection.”
What to do if you’re struggling to pay your energy bills
It’s important to remember that energy is considered to be an essential service to your home, and shouldn’t be cut off without your retailer taking the necessary steps to alert you to financial aid and payment options that might be available to you first.
If you find yourself in a position where you are struggling to pay your bills, here are some things you can do:
- Contact your energy provider: Your provider may be able to switch you to a cheaper or better-suited energy plan if you give them a call.
- Look up your retailer’s customer hardship policies: Each retailer is required by law to have a customer hardship policy that is easily accessible to customers. Most of these can be found on retailer’s websites, however, sometimes you may need to call and ask for it. These documents outline the information on financial support and payment options available to you, should you find yourself unable to pay your bills.
- Research energy concessions and grants: In addition to support from your retailer, you may also be eligible for financial support from the government.