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  • Energy companies ruled at fault in most wrongful disconnection cases
  • By Beau Donelly
  • 18/09/2014 Make a Comment
  • Contributed by: Simon_P ( 2 articles in 2014 )
Major energy companies were overwhelmingly found to be at fault when cutting their customers' gas and electricity supply, an investigation by the state's essential services regulator into the most serious disconnection disputes has revealed.

The worst offender was energy giant AGL, which accounted for more than half of all disconnection disputes elevated to the Essential Services Commission between 2011 and 2013. The largest wrongful disconnection payment during this period was against AGL, for more than $125,500, after it cut electricity and gas to a customer who was on welfare.

The Essential Services Commission's annual report, tabled in State Parliament on Tuesday, shows it ruled in favour of customers in more than 80 per cent of wrongful disconnection cases that were fought by energy retailers. Of the 37 cases examined by the commission, the companies were found to be in breach of the Energy Retail Code in 31 cases.

Over the past three years compensation awarded to customers who took their fight to the commission, after their case could not be settled through the Energy and Water Ombudsman, amounted to $381,000.

The Commission ruled against AGL in 20 out of its 21 wrongful disconnection cases in the three years to the end of 2013. Since July 2013 AGL has lost six of nine cases referred by the Ombudsman, but the commission said the energy company was still refusing to pay out one customer.

In 2011 AGL was ordered to compensate customer "D" $125,504 for wrongful disconnection because it "failed to assess [her] capacity to pay" and "failed to provide [her] with information on energy efficiency assistance and the availability of independent financial counsellors". The company was also ordered to compensate customer "G" $13,297 for wrongfully cutting gas to her house for 53 days without taking adequate steps to warn her.

An AGL spokeswoman on Wednesday said customers who kept in contact with the company would not be disconnected.

"AGL works closely with customers who are struggling to pay their bills and our guiding principle is that customers who engage with our hardship program remain connected while we work through the options available to assist them in managing their energy bills," she said.

Seven of the eight cases involving Tru Energy, now operating as Energy Australia, were decided against the company. AP&G, Neighbourhood Energy and Origin Energy each had one case examined by the commission, with each ruled against the retailers.

Red Energy and Lumo Energy were the subject of two and three reviews respectively. Red Energy was found to be in the right in both cases, while Lumo won two out of three cases.

The annual report also reveals Australian Power and Gas, now owned by AGL, overcharged more than 10,000 customers early termination fees when they cancelled their contracts. The commission said the energy company has since contacted and refunded all affected customers.

The commission also investigated an incident reported by EnergyAustralia involving its telemarketers signing up "significant numbers" of customers without a complete record of their consent. The energy company has since confirmed consent or released the customers from their contracts, the report said.

Energy Retail Code (current version)


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