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Electricity firms warn disconnection ban will mean worse problems in future

State’s biggest electricity supplier said it supported moratorium

Several electricity firms have warned the moratorium on cutting off electricity would only create larger issues next year

Ken Foxe
Tue Dec 20 2022 - 19:40

Electricity companies said extending the winter moratorium on cutting off people’s power supply would lead to increased debts for customers and store up even bigger problems for next year.

In correspondence with the energy regulator several power companies said threats of disconnection were the only ways in which some indebted customers ever dealt with them. Yet Electric Ireland, the State’s biggest residential supplier, said it supported extending the moratorium and only sought clarity on whether it would also apply to non-domestic customers.

Bord Gáis Energy told the Commission for Regulation of Utilities (CRU) that it was not in favour of ever disconnecting customers and never cut off “any engaging customer”. However, it said extending a moratorium might not help people who were already significantly behind on their energy bills.

A letter from it said: “The disconnection process is the point at which we get most engagement by customers in debt. Taking away that process for a longer period of time will not help customers better manage their debt, it will only act to increase the debt they have at the point of engagement.”

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The letters were sent in July as the CRU considered new measures to help customers struggling with energy bills, including an extended ban on cutting off power from December 1st to 28 February 28th.

Bord Gáis Energy also said it would never disconnect anybody on its “vulnerable customer list”, but warned the winter ahead was likely to be “unprecedented”, and it would do everything it could to help customers in need.

In a letter to the regulator, Panda Energy said that extending the winter moratorium might only “exacerbate” the problem it was trying to fix. It said “unfortunately the disconnection process can in some occasions be required to instigate engagement with a customer”.

Panda said cutting off somebody’s power would only ever be used as a “last resort” but that an extended moratorium would do “little to incentivise customer engagement”.

Its letter said: “Moratoriums on disconnections give customers the impression they won’t be cut off and do not have to engage. We would not be supportive of this measure. A strong communications programme from the regulator highlighting the importance of engagement would be a more practical solution.”

Flogas also raised concerns about extending the winter moratorium saying it would have limited impact on reducing disconnections or increasing customer engagement. It said delaying even the threat of cutting off power would leave customers in “increasing levels of debt” that would escalate over the winter period.

A letter said: “Amending the Christmas moratorium to a period of three months is excessive ... [and] could create a risk of increased arrears if there is a change in process for a sustained period of time.”

It said a better option would be to identify customers that needed support, and raise awareness of what help was available, rather than “deviation from the existing disconnection process”.

The Electricity Association of Ireland also warned there were risks attached to extending the moratorium, with “debt build up that could otherwise be avoided”.

SSE Airtricity said that a moratorium extension did nothing “meaningfully” to help a customer struggling with bills.

Asked about the records that were released under Freedom of Information, the Commission for Regulation of the Utilities said it had nothing further to add to their contents.

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