Friday, April 18, 2014

Power giants illegally disconnecting hundreds of Victorians each year

ELECTRICITY and gas retailers are illegally disconnecting hundreds of Victorians each year as customers struggle with soaring bills. 
Some have suffered up to two months without supply before winning compensation.

Retailers are supposed to follow strict rules for cutting off customers over unpaid bills.

These include first offering help to those in financial stress, giving enough warning, and being careful not to disconnect the wrong address.

But the Energy and Water Ombudsman Victoria says that in almost half of its investigations of disconnections, companies were revealed to have flouted regulations.

The unfair treatment is exposed in its submission to the State Government, which has proposes doubling payments for wrongful disconnection to $500 a day.

Disconnection complaints to the ombudsman exploded by 380 per cent in five years.

Last financial year alone, 845 cases were found to deserve compensation. In 309, retailers agreed to pay without admitting rule breaches.

“From 2008-09 to 2012-13, on average 48 per cent of actual energy disconnection investigations received were found to have a WDP (wrongful disconnection payment) applicable,” the submission says.

“These results reveal that the retailer had breached the terms and conditions of the customer’s contract, following almost one in every two actual energy disconnections investigated.”

Disputed findings can be referred to the Essential Services Commission for a final ruling.

Consumer groups support proposed higher compensation for customers unfairly cut off.

But Ombudsman Cynthia Gebert was unsure this would solve the problem. She said identifying and helping those in financial strife earlier was the priority.

“Given there are a growing number of Victorians being disconnected, and that the number of wrongful disconnections is not decreasing, a focus is required on improving retailers’ processes,” Ms ­Gebert said.

Repeated concerns have been raised about disconnection as a debt-collection tool in place of payment plans and other assistance.

Power companies pulled the plug on a total of 25,254 residential customers with unpaid bills last financial year.

Gas firms disconnected 16,979 households. 27 Mar 2014

In most cases one would have to take the power giants to court, an action that most families cannot afford, and the power giants know this.

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