It’s double the amount than what electric companies propose, yet less than the $500 that consumer groups sought. Ahe Australian Energy Regulator set the bar at $300 – the proposed setting for electric disconnection limit.
If the national law comes into effect, power companies will be banned from disconnecting customers over unpaid bill of less than $300. Under the proposed regulation, power companies will be required to cut off a household’s gas supply before they resort to disconnecting electricity.
On top of that, they will have to offer payment plans or hardship assistance to customers who tell them they are having trouble paying bills. Customers who take part in a company’s payment plan, usually by paying instalments, will be protected from disconnection regardless of what they owe.
The AER’s proposal – released for public comment yesterday – coincides with a surge in the number of customers disconnected for failing to pay rising power bills.
Australian and New Zealand Ombudsman Association chairwoman Clare Petre, who is the NSW Energy and Water Ombudsman, said more families were struggling to pay their utlity bills.
“Given that energy bills have increased, to have people disconnected for a small amount seems out of propotion,” she said.
The Consumer Action Law Centre said the cut-off should be set at $500 so customers were not penalised for missing just one bill.
Under the new national consumer law for energy utilities, customers will have to promise to repay the debt.
The Australian Energy Market Commission estimates that residential electricity prices will soar by more than one-third nationally by 2014.