Disconnection when you pay in instalments
If you have an arrangement to pay in instalments, either for your current supply only or for your current supply plus an amount for arrears, the supplier is not entitled to disconnect for arrears while you keep to the terms of your agreement, since you are paying the amounts requested in writing.1Sch 2B para 7(5) GA 1986
If you miss a payment, the supplier is entitled to disconnect for arrears from 28 working days after the date of your missed payment, but only if there are still charges due (see above), and providing you have been given seven working days’ notice of the intention to disconnect. If your account is in credit, based on a reading of your meter and allowing for any standing and other charges, the supplier is not entitled to disconnect your supply.
In practice, rather than actually disconnect, suppliers are more likely to try to impose a prepayment meter. The supplier has to inform you of its intention to disconnect, subject to the notice period above, before being entitled to install a prepayment meter no less than 28 days from the date of your missed payment. A prepayment meter may be installed with your agreement at any time. This may also carry additional costs. If you have a smart meter, it can be recalibrated remotely from credit to prepayment mode. See here for how to resist a prepayment meter. Alternatively, your supplier may decide that a security deposit is required just in case you do not keep to your agreement to pay by instalments.2s20(1)(a)(b) EA 1989; s11 GA 1986 (as amended); Condition 27 SLC The supplier has to write to you to inform you of this. The supplier must give you notice that it intends to disconnect if you do not pay a security deposit. A prepayment meter may be imposed if you do not wish to pay a security deposit. See here for more about security deposits. If the breakdown of your instalment arrangement has occurred because you cannot afford to pay, you may be able to arrange an alternative, more suitable payment plan. Remember, under their supply licence conditions, suppliers are required to make instalment arrangements based on what you are able to pay.3Condition 27.8 SLC You can write to your supplier with a completed budget sheet and letter explaining what you can afford to pay. In any event, the supplier must offer you a prepayment meter as an alternative to disconnection and as a payment option, providing this is ’safe and practicable in all the circumstances’ to do so and ‘calculated in accordance with’ what you are able to pay.4Condition 27.6(a)(iii), 27.8 and 27.9 SLC
Payment arrangements fail for a variety of reasons. It might have been the wrong arrangement from the outset: the commencement date may not coincide with the receipt of income; the frequency of payments may not coincide with the receipt of income; or the amount for consumption or arrears may be set too high (or too low) and was unaffordable. There may have been a change in the household, lifestyle or appliance use. You may have been ill or in hospital. Failing to keep to an agreement should not automatically preclude the possibility of another one being arranged – it is essential to establish why a previous arrangement failed.
Under their supply licence conditions, suppliers are required to make instalment arrangements based on what you are able to pay.5Condition 27.8 SLC A supplier found to be contravening the relevant licence conditions can be faced with regulatory action and enforcement by Ofgem. You should be prepared to raise a formal complaint if you feel that a supplier is failing to meet its licence conditions. Fuel Direct (see here) should also be considered as a payment option. Suppliers are expected to use ‘where available, a means by which payments may be deducted at source from a social security benefit received by that customer.’6Condition 27.6(a)(i) SLC The use of the words ‘where available’ suggests that a supplier may be at fault if it overlooks or ignores this option.7See Conditions 27.5 and 27.6 SLC Note: between 5 April 2022 and 5 April 2023, suppliers cannot request new or increased fuel direct payments.8