Families and employers face mounting arrears on electricity bills

Hundreds of thousands of families and employers face mounting arrears on energy bills following 14 months of Government Covid curbs, official figures show.

Regulators will lift a ban on electricity and gas companies disconnecting customers in arrears from June 1st, but warn that bad debts have been mounting in recent months, as businesses and homes struggle to pay bills.

Figures from the Commission for Regulation of Utilities (CRU) show that 280,300 electricity customers had fallen behind with bill payments by the end of February.

Of these, 240,006 were households while almost 40,300 were “non-domestic”, which were mainly businesses.

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The same figures show that 30,000 non-domestic customers were in arrears with their bills in February last year, before the Government shut down many enterprises as part of its effort to combat the pandemic.

Gas customers

Almost 120,100 gas customers were in arrears in February, with 112,833 families accounting for the bulk of them. That was up 25 per cent on the 94,044 domestic customers whose bill payments were not up to date in February 2020.

The number of non-domestic gas customers in arrears more than doubled to 7,259 in the 12 months to February this year.

The CRU was unable to say on Wednesday how much gas and electricity customers owed in arrears.

State-owned ESB, which supplies both fuels to about a million families and employers, said recently it was putting aside €15 million to provide for potential bad debts, but added that it hoped that the final figure would be less than this.

The CRU told energy companies in January to hold off on disconnecting customers in arrears to provide added protection during Covid-19 restrictions.

The regulator said on Wednesday that it would lift this ban on from June 1st, but insisted that an existing code still prevented suppliers from cutting off customers who contact them in an effort to settle the arrears.

Debt

Since March 2020, the commission says, “an upward trend in debt levels has emerged” leaving suppliers and customers with a long-term challenge.

“A proportion of customers are remaining in debt with their energy suppliers for longer which, in effect, stores up the problem for customers to a later date,” the CRU warned.

Companies must give customers every chance to avoid disconnection and encourage those with difficulties to talk to them as early as possible.

Overall, since March 2020 the CRU has imposed separate moratoriums totalling 42 weeks that have barred utilities from cutting off customers with arrears.

Aoife MacEvilly, CRU chairwoman, said those bans gave customers extra protection during lockdowns.

She argued that the time had come to revert to existing protections for customers to help avoid increasing debt.

“The CRU will continue to monitor the market to ensure that customers are given the full protections as set out in the supplier handbook,” Ms MacEvilly said.

“Under these, all customers must be offered a reasonable and affordable debt-recovery option which takes account of the individuals’ circumstances. This could be a payment plan or a pre-payment meter.”

She pledged that customers agreeing to those steps would not be disconnected.