AER Statement of Expectations of energy businesses: Protecting customers and the energy market during COVID-19

Category: 
COVID-19 response
Statement of expectations
Release date: 
27 March 2020

Overview

On 24 March 2021, we extended our current Statement of Expectations of energy businesses for a further three months, until 30 June 2021. The Statement extends important protections for energy customers, and encourages retailers and customers to stay in contact and for customers to reach out for help.

While some consumers are getting help with their energy bills, we want to see retailers offering more consumers sustainable payment plans and hardship supports to help manage debt for households and small businesses as we try to return to normal.

Household and small businesses should get in touch with their retailer immediately to receive the support needed to protect them from disconnection.

The extended Statement of Expectations applies from 1 April 2021 to 30 June 2021. It is likely the Statement will end on 30 June 2021, so it is time for retailers to move more customers onto payment plans or hardship arrangements so they can start paying off debt and begin a return to normal.

Key points

  • The Statement sets out important steps we expect energy businesses to continue to action until 30 June 2021, to protect customers and the market as a result of the COVID-19 pandemic.
  • The AER intends for this to be the last Statement of Expectations, however a key factor in determining the AER’s future approach will be the extent to which there are further pandemic-related health events which require social and physical distancing responses. 
  • Retailers have predominantly done the right thing by those doing it tough due to the pandemic. We expect this to continue, with a focus on providing payment plan and hardship supports, rather than deferred debt. 
  • This includes:
    • listening to customers, who are best placed to know their own circumstances and capacity to pay
    • listening to financial counsellors and other representatives that customers have chosen to act on their behalf (noting that customers are not required to engage financial counselling services in order to access retailer supports)
    • recognising that a positive experience is more likely to encourage ongoing engagement
    • taking steps to proactively identify customers who may be in financial distress.
  • We are calling on retailers to proactively engage with their consumers to ensure they are accessing eligible supports under the Statement of Expectations and the existing law and rules. 
  • Customers who can pay should continue to do so. This is vital for the viability of the sector so that it can continue to provide the support for customers who need it.
  • Customers should contact their retailer to find out what support is available.

Our expectations

  1. Offer all residential and small business customers who indicate they may be in financial stress a payment plan or hardship arrangement. These payment plans or arrangements may include agreeing a period in which no payment will be made.
    1. Work with customers who may be in financial stress to make payment plans and hardship arrangements sustainable by taking into account their capacity to pay, and ensuring customers are on the tariff most likely to minimise their energy cost. Retailers must consider actions that will minimise customers’ debt such as re-calculating debt obligations using a lower cost plan if available. Customers should be moved to another plan only with their explicit informed consent.
  2. Before 30 June 2021, do not disconnect – other than at their request:
    1. any residential customer who may be in financial stress who:
      1. is in contact with you in relation to their debt; or
      2. is accessing any retailer support, and
    2. any small business customer who continues to adhere to a payment plan or other agreed payment arrangement.
  3. Before 30 June 2021, do not disconnect – other than at their request – a body corporate or other large business customer who is on-selling energy to residential and small business customers, who may be in financial stress and who:
    1. has made contact with you or responded to communications from you; or
    2. is accessing any retailer support.
  4. In the event a customer has not made or responded to any contact and has been disconnected for non-engagement, the retailer must process an order for reconnection immediately on contact from the customer and the retailer must waive disconnection, reconnection and contract break fees.
  5. Defer referrals to debt collection agencies for recovery actions or credit default listing until 30 June 2021, for:
    1. a retailer’s residential customer or former customer who may be in financial stress who:
      1. is in contact with you in relation to their debt; or
      2. is accessing any retailer support, and
    2. a retailer’s small business customer who continues to adhere to a payment plan or other agreed payment arrangement.
  6. Be prepared to modify existing payment plans if a customer’s changed circumstances make this necessary.
  7. Networks and retailers should waive disconnection, reconnection and/or contract break fees for small businesses that have ceased operation, along with daily supply charges to retailers, during any period of disconnection until 30 June 2021.
  8. Prioritise the safety of customers who require life support equipment and continue to meet responsibilities to new life support customers.
  9. Prioritise clear, up-to-date communications with customers about the issues addressed in this Statement, including by keeping website, social media and call centre waiting and hold messages up to date, particularly those about the availability of retailer and other supports such as payment plans, energy efficiency advice and fault repair.
  10. Minimise the frequency and duration of planned outages for critical works, and provide as much notice as possible to assist households and businesses to manage during any outage.

The Statement also covers:

  • AER approach to compliance during this time
  • our priorities, and
  • how to stay up-to-date with AER developments.