Energy UK plays a leading role in the development of industry best practice in the areas of debt and disconnections. Energy suppliers recognise that vulnerable customers need to be protected from disconnection.
Safety Net for Vulnerable Customers
As the Energy Retail Association, in 2004, our members signed up to the Safety Net for Vulnerable Customers. It includes a commitment to never knowingly disconnect vulnerable customers. Where a customer has been disconnected and then is identified as vulnerable, the supplier will reconnect their customer as a priority.
Since the Safety Net was founded, the nature of debt and disconnection in the UK energy retail market has changed beyond recognition. In 2003 there were around 16,000 disconnections of domestic customers for debt in the UK. In 2015 - the most recent year for which published data exists - there were just over 250.
Participating Energy suppliers want to know they are performing as well as they can against the aims of the Energy UK Safety Net. This is why the signatories undergo an audit each year to measure how they deliver against 13 key objectives including having specialist teams to support vulnerable customers, monitoring repayment options so they take into account a customer’s ability to pay and never knowingly disconnecting a vulnerable customer.
The results of the 2015 Safety Net Audit, carried out by PwC, can be viewed here. This is the first time the results of the Safety Net audit have been published. The commitment to publish the results reflects the increasing priority Energy UK’s members place upon protecting their most vulnerable customers.
Why is disconnection used?
Disconnection is only ever used as a last resort. It follows a lengthy attempt by the supplier to recover a debt. It is rarely used and only in cases where customers won't pay their bills. Before disconnection is considered, suppliers try to find out the customer's circumstances and set up an affordable payment plan. The Safety Net gives information on how suppliers protect vulnerable customers from disconnection.
Although suppliers do not want to disconnect their customers and go to great lengths to avoid it, in the interests of their other customers, it is a sanction that must remain. Energy UK believes that if this deterrent didn't exist, debts would rise across the industry and affect all customers, including those on low incomes. It is not fair that customers who do pay - including those in, or at risk of fuel poverty - pay for customers that can afford to pay but choose not to.
How prepayment meters help to avoid disconnection
Many customers choose to pay for their energy via a prepayment meter (PPM), often because it helps with budgeting. PPMs are also used to help avoid disconnections. Suppliers will not install a PPM unless it is safe and practical to do so.
Energy UK's work to help lower customer debt
Energy UK works with the Regulator, Consumer Groups and others to make sure the debt and disconnections pathway considers customers' needs. Suppliers are aware that customers who are struggling to pay may have other debts. This is one reason why Energy UK and suppliers work so closely with the money advice sector, including organisations such as Citizens Advice, the Money Advice Trust and the Money Advice Liaison Group.
Energy theft and disconnection
Crimestoppers in partnership with industry has launched a free service for the public to report energy-related crime. The service allows for landlords, tenants, businesses and the public to come forward and report any suspicions, incidents or evidence of crime, either through the website via an anonymous, non-traceable form at stayenergysafe.co.uk or on the dedicated number, 0800 023 2777.
Energy theft is a crime that impacts all energy users, and is liable for prosecution. Around 1,500 people in the UK are charged by the police for energy theft each year.