Special features of electricity and gas arrears
Fuel supplies may be disconnected if there are arrears, and this is likely therefore to be a priority debt (see Chapter 8). The prioritisation of the debt depends on the client’s continued need for that fuel at her/his present address.
Note: a supplier cannot transfer a debt from a previous property to a new account and then disconnect that fuel supply for the previous debt. A supply can only be disconnected at the address to which the bill relates.1Sch 6 para 2 EA 1989; Sch 2B paras 6A and 7 GA 1986, as amended by UA 2000. Although the legislation refers to unpaid charges for the supply of gas/electricity to ‘any premises’, it then goes on to provide that the supplier may disconnect ‘the premises’. If the legislation had intended the supplier to be able to disconnect any premises and not just the premises to which the supply relates, the legislation could have specifically said so. It may be possible to reduce charges by changing supplier. If the arrears are more than 28 days old, the old supplier can object to the transfer unless the arrears are paid. This does not apply to clients with pre-payment meters, provided the debt does not exceed £500 and the client agrees that the new supplier can collect the arrears through the meter. If the client has both gas and electricity from the same supplier, the figure is £500 per fuel. If the transfer goes ahead without objection, the arrears cannot be transferred to the new supplier.
A pre-payment meter can only be fitted at the address to which the bill relates (unless the client requests otherwise).
Estimated bills
Arrears of gas or electricity payments may arise as a result of high bills. While high bills may be caused by high consumption, price increases or previous underpayments, they may also be caused by estimated bills based on wrong assumptions about the amount of fuel used.
Many bills are based on estimated meter readings. Under their licence conditions, suppliers are only required to obtain actual meter readings once every two years. If the estimated reading is different to the actual reading, the client should read the meter her/himself and ask for this reading to be used in order to avoid either an overpayment or an underpayment which could lead to arrears. The name and address of the client, as well as the address to which fuel was supplied, should be noted from the bill.
If the bill is estimated and the estimated reading is higher than the actual reading, it is possible to reduce the amount owing. The bill will explain (often by means of an ‘E’ next to a reading) whether an estimated reading has been given. Clients can read their own meters and provide the supplier with their reading, and so should never be disconnected on the basis of an estimated bill. You should ask the client to read the meter and request an amended bill.
Backbilling
Ofgem has introduced a licence condition (applying to both electricity and gas suppliers) to protect customers from backbills. The new licence condition applies to all meter types and payment methods. With effect from May 2018, when a supplier issues a bill, it can only seek to recover charges for energy consumed in the previous 12 months unless:
•the bill was sent before the licence condition came into effect; or
•it has previously issued a compliant bill and is chasing previously billed charges; or
•the client behaves in an ‘obstructive or manifestly unreasonable way’.
The new licence condition replaces the previous voluntary arrangements, which only applied to some suppliers and were not always followed in practice (see previous editions of this Handbook). In addition, the voluntary arrangements worked on the basis of a ‘supplier at fault’ principle.
Ofgem has provided a few examples of when it would consider a client’s behaviour to be ‘obstructive or manifestly unreasonable’:
•where the client behaves unlawfully by stealing electricity or gas or not keeping her/his meter in working order (where the client is using her/his own meter); or
•the client prevents physical access to the meter – eg, by not allowing a meter reader into the home without good reason.
Ofgem has confirmed that it does not consider a client to be ‘obstructive or manifestly unreasonable’ when s/he does not supply a meter reading. If clients do not respond to requests for a meter reading, suppliers should take a meter reading themselves to avoid billing based on estimates. This means suppliers will have to put more effort into obtaining meter readings from their customers.2Ofgem, Decision: Modification of the electricity and gas supply licences to introduce rules on backbilling to improve customer outcomes, ofgem.gov.uk/system/files/docs/2018/03/backbilling_final_decision_policy_document_-_march_5_-_website.pdf. Social tariffs
‘Social tariffs’ (reductions on the standard tariff) have been phased out, but clients on a low income (eg, getting pension credit) might also qualify for a £140 Warm Home Discount. See gov.uk/the-warm-home-discount-scheme for more details. Meter faults
If a gas or electricity meter is registering fuel consumption at too high a rate, the client will receive a bill that is higher than it should be. According to the industry, meter faults are rare but, if the client believes a meter is faulty, the fuel supplier will check the accuracy of the meter if requested to do so.
See CPAG’s Fuel Rights Handbook for more details (see Appendix 2). Meter tampering
Tampering with a meter in order to prevent it registering or to reduce the amount it is registering is a criminal offence. Accusations of tampering usually follow a visit to the client’s home by a meter reader who has noticed and reported something unusual about the meter. The supplier should write to the client informing her/him of an investigation into suspected tampering. If the meter is considered to be in a dangerous condition, it may be unusable pending the investigation. The investigation should be carried out in accordance with the code of practice and you should obtain a copy of this from the supplier.
If a client is threatened with prosecution, s/he should be referred to a solicitor.
Other assistance
Clients may be able to obtain a grant to pay off fuel debts.3See also M Egan, ‘The Good Trust Fund Guide’, Adviser 164 Some energy suppliers have trust funds to help customers who are in debt, or may fund projects for the fuel poor. Grants are available for electricity and gas bills and may also be available to pay other essential household bills. Auriga Services (which works with utility companies to assist customers who are vulnerable or in financial hardship) publishes a booklet summarising the schemes, called Help with water and energy bills, available at aurigaservices.co.uk/wp-content/uploads/2019/10/Auriga_waterandenergy_Online.pdf. Clients can also take steps to help save energy and reduce fuel bills. The Energy Saving Trust offers free advice on ways to reduce fuel consumption and should be aware of grants that are available locally to help cover the cost of energy efficiency measures. See energysavingtrust.org.uk or telephone 0800 444 202. All suppliers must provide a range of free services (including quarterly meter readings) to clients who are on their Priority Services Register. This is available to clients who:
•have a disability; or
•are over pension age; or
•are chronically sick; or
•are visually impaired or have hearing difficulties.
See CPAG’s Fuel Rights Handbook for more details (see Appendix 2).