AER releases review of energy retailers' hardship policies and practices

The Australian Energy Regulator has released a report on its targeted review of energy retailers’ hardship policies and practices.

“Many households will have trouble paying their energy bill, and unfortunately even careful budgeting may not be enough to make ends meet. This review helps us to better understand how retailers are identifying and assisting customers that are struggling to pay their energy bills and to share examples of good practice,” AER Chair Paula Conboy said.

“If you are worried about being unable to pay your energy bill on time, call your retailer as soon as possible to discuss your situation. They must offer you assistance. Ask about an extension, a payment arrangement or their hardship program. You should also check if you are receiving any concession you may be eligible for and ask if your retailer can offer you a cheaper deal.”

Key findings

  • The review suggested many community concerns about hardship assistance and payment plan affordability are linked to broader issues of energy affordability and a lack of consumer awareness about the assistance available to them. The concerns don’t indicate widespread failure by the retailers to meet their hardship obligations under the Rules.
  • While the review revealed a range of practices, some retailers seem more committed to assisting hardship customers than others, for example by better promoting the availability of assistance; staff training to promote more effective engagement; or innovative assistance offerings.
  • The strong theme highlighted by consumer stakeholders was the importance of respectful practice: how a retailer engages with the customer to listen and validate their experience of financial vulnerability is most important in developing trust and maintaining engagement.

“We have already seen encouraging progress in response to the review; with a number of retailers acknowledging the review has prompted them to review their hardship policy and process documentation and to consider improvements to the information they provide to consumers experiencing payment difficulties,” Ms Conboy said.

“The AER is part of the national conversation on issues of energy affordability and hardship and we will continue to work with retailers and other key stakeholders to explore, develop, and implement strategies to raise standards to better help the customers who most need hardship assistance. We welcome the engagement of our stakeholders on this review.”

Visit the AER’s Energy Made Easy website to compare offers and read more tips about managing your energy service.

Background

Under the National Energy Retail Law and National Energy Retail Rules, energy retailers are required to develop and maintain a customer hardship policy that sets out their approach to identifying and assisting customers experiencing difficulty paying their energy bills. The Retail Law and Rules set out minimum requirements for a retailer’s hardship policy which must be approved by the AER.

The review covered energy retailers with residential customers in states and territories where the Retail Law has commenced - New South Wales, the ACT, South Australia and Tasmania.

Issued date: 
28 January 2015
AER reference: 
NR 001/15