Residential disconnections for gas and electricity are on the rise again.
As millions of Australians sit in lockdown, all thanks to the delta variant causing havoc across the nation, residential and small business disconnections for gas and electricity are rising beyond pre-covid numbers.
So, what’s exactly going on, and why are energy suppliers disconnecting their customers again?
Let’s go back to March 2020, when Australia entered its first nation-wide lockdown.
Due to the strict nature of the lockdown, the Australian Energy Council implemented regulations in April to stop energy suppliers from disconnecting their customers’ electricity and gas supply without the consent of their customers.
And it worked - between April and August 2020, no disconnections were made without a customer’s consent.
Suppliers who didn’t follow these regulations were fined
EnergyAustralia, which supplies electricity and gas services to NSW, Victoria, Queensland and South Australia residents, was ordered to pay $1.5 million, after the Federal Court found it had breached these regulations and wrongfully disconnected eight customers who were in financial hardship.
But by November, as the country opened back up and life returned to near-normal routine, regulating boards weakened the protections of these directives, allowing energy suppliers to disconnect accounts for:
Customers they couldn’t make contact with;
Small businesses that had not arranged a payment plan.
But then, the Delta variant arrived.
As our not-so-welcomed friend, Delta, arrived on Australian shores, states were sent into their second, third, or even fifth lockdown. Customers struggling to pay the bills because of these new restrictions are finding their power cut off, as they are no longer protected by last year’s regulations.
This is of concern, considering that small businesses debt to energy retailers has increased by 22%, and residential debt by 32%.
The Australian Energy Council, which represents 12 energy retailers across the country, expects those numbers to get worse.
The council is also pushing back against harder restrictions, as they say that retail energy businesses have shouldered their fair share of the economic burden through COVID-19.
In better news, there are protections for NSW residents that have been put in place as the state’s lockdown is extended for another 4-weeks.