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Reflect
Cynthia Gebert

"Our outreach work is also informed by what we see in our case data. Of particular concern is the fact that imminent and actual disconnection cases for Aboriginal and Torres Strait Islander customers are back in the top five issues for these customers, after dropping out of the top five during the Victorian lockdown."

Our case numbers dropped again in the first quarter of 2021, down 5% from the last quarter of 2020, however, case numbers climbed slowly from January to March. Billing cases dropped, reflecting the seasonal changes in billing complaints, and credit cases rose in early 2021.

Of particular interest is the rise in disconnection cases reaching EWOV. Disconnection cases rose 119% in the first quarter of 2021, when compared with the previous quarter. In the previous edition of Reflect, we expressed our concern that there may be a future surge in disconnections after the end of lockdowns in Victoria and due to the amount of customer debt in the sector. Clearly, that concern was warranted. We explore disconnection cases in more detail in this edition of Reflect, including disconnection cases involving ‘Dear Occupier’ letters.

We also highlight our outreach work in the first quarter of 2021, the first opportunity for us to get out in the community in person, following the easing of COVID-19 restrictions. Our outreach work is also informed by what we see in our case data. Of particular concern is the fact that imminent and actual disconnection cases for Aboriginal and Torres Strait Islander customers are back in the top five issues for these customers, after dropping out of the top five during the Victorian lockdown.

We delve into all this and more in the latest edition of Reflect. As always, you can find more data relating to our casework in the Data Hub.

Issues watch

In the last edition of Reflect, we highlighted the late surge in disconnections in the lead-up to Christmas, following the easing of COVID-19 restrictions in Victoria. Disconnection cases continued to rise in the first quarter of 2021, jumping 119% from the last quarter of 2020. Payment difficulties cases were steady and credit collection cases actually fell by 15%, which could indicate that some retailers moved quickly to disconnect some customers.

Our case data indicates that a small number of retailers were responsible for the majority of recent (imminent) disconnection cases, particularly one first-tier provider. This is a reminder that the process applied by individual retailers can have a profound effect on customers and the complaints that get lodged with EWOV.

We are watching disconnections cases closely, particularly following the ESC’s recent clarification to energy companies about their expectations around disconnections and the application of the Payment difficulty framework. This advice runs from April to the end of June 2021. We are also aware of the reduction in entitlements and protections that took place at the end of March 2021, including a change to JobKeeper and JobSeeker and the end of the moratorium on rental evictions in Victoria. These changes will inevitably worsen the financial circumstances of some customers.

The recent surge in disconnections cases is another reminder that energy retailers have an obligation to provide support to customers under the Payment difficulty framework. Many cases that reach us involve customers with considerable accrued debt, which could have been alleviated or avoided with the appropriate application of the Payment difficulty framework provisions by their retailer. The ESC’s clarification to energy companies about disconnections specifically highlights the Payment difficulty framework and how it interacts with disconnections, including protecting customers from disconnection if they are experiencing financial difficulty, and in contact with their retailer about their debt or accessing any retailer support, including under the Payment difficulty framework.

Transfer cases rose 48% in the first quarter of 2021, when compared to the previous quarter. Of particular interest are Transfer>In Error>Disconnection cases (up 193%) and Transfer>In Error>Imminent Disconnection cases (up 100%). Many of these cases relate to ‘Dear Occupier’ letter disconnections. In these cases, retailers have disconnected customers after sending out 'Dear Occupier' letters to customers at properties they have billing rights to, and with whom they haven’t been able to engage. Many of these customers had been paying other retailers for their usage and were unaware that the disconnecting company had billing rights.

This data suggests that some retailers are prioritising disconnections on properties that they have billing rights to but with which there are no active accounts, as these are quicker to action than non-payment disconnections for known customers. There is a danger in these types of disconnections, as they can impact customers who may be experiencing vulnerabilities of which the disconnecting retailer is not aware. Retailers should explore all avenues to resolve these issues before disconnecting the property.

The big picture


  • From January to March 2021, we received 4,477 cases, down 5% from the previous quarter and down 22% from the same quarter in 2020.
  • Billing cases dropped significantly, down 22% from the previous quarter, but this may reflect seasonal factors in billing cases (we generally receive many high bill complaints in the middle to late part of the calendar year).
  • Credit cases rose 15% on the previous quarter – this may reflect an increase in credit activity from retailers following the end of lockdown in Victoria.
  • Disconnection cases were up 119% from the previous quarter. In comparison, payment difficulties cases were steady and collection cases actually fell by 15%, indicating that retailers may have moved quickly to disconnect. The rise in disconnection cases relates particularly to imminent disconnection cases in the electricity and gas markets.
  • Other issue types to rise slightly were transfer and marketing – transfer in error and objections to transfers accounts for most of the increases in transfer cases.
  • The rise in marketing cases relates particularly to the sub-issue Marketing>Misleading>Other Sales Channels. Raw case numbers were low but they did increase 73% when compared to the previous quarter, despite our overall case numbers falling. Customers reported receiving incomplete or misleading information on web chat services and via online marketing and email marketing. The data may be a prompt for retailers to revisit their online and email marketing to ensure it is correct and up to date.

We’re watching overall case numbers and billing cases

  • The low level of case numbers is consistent with the low numbers we’ve seen since the beginning of the pandemic and although we’re starting to see a turnaround in case numbers, we believe the interventions made by government and regulators are still having a positive impact.
  • The change to JobKeeper and JobSeeker benefits, which came into effect in late March, may have an impact on credit cases in the April to June quarter.

Disclaimer

  • Reflect and Data Hub data is a ‘live’ view of case data up to the end of the previous period.
  • Cases can sometimes be amended, reopened and reallocated — adjustments made to cases in previous quarters will be shown in the previous quarter's figures within the visualisations.
  • For these reasons, there may be discrepancies between previous quarter data presented in the visualisations and the information presented in past editions of Reflect.

Customer stories

Embedded network customer can’t contact provider about bills

BILLING FEES AND CHARGES | EMBEDDED NETWORK

Case number: 2021/254

We resolved a complaint for Josie* in 2020 related to the operator of the embedded network that sold her electricity. Josie moved into a rental in early 2020 and didn’t receive any bills. She was told by her provider that it would issue bills soon and then received four months of bills with only one month to pay the balance. The case resolved with the provider waiving some of the amount owed.

Josie returned to us in early 2021, telling us she hadn’t received subsequent bills from her provider, covering the rest of 2020. She advised that she had contacted the provider and it had advised that it would contact her but did not provide a timeframe. We raised an Assisted Referral and Josie returned to us to advise that the provider had not contacted her in the time allowed for the referral.

We started an Investigation, which was upgraded from stage 1 to stage 2 because the provider failed to respond to our requests in time. After we did manage to communicate with the provider, the complaint was resolved with the provider committing to waive Josie’s most recent bill and apply a $250 customer service gesture to her account.

* Names have been changed

Significant debt and an imminent disconnection notice

IMMINENT DISCONNECTION | PAYMENT DIFFICULTY | COVID-19

Case number: 2021/1885 + 2021/1887

Freya* called our 1800 number about imminent disconnection notices she had received from her retailer. She owed more than $4,000 on her gas account and more than $5,000 on her electricity account. She told us she was experiencing payment difficulty and had mental health issues, and had not made a payment in the past 12 months due to COVID-19. Freya told us she received a letter from a debt collector asking her to make a payment to avoid disconnection. She said she contacted her retailer to request a $50 fortnightly payment plan and it advised her to contact a financial counsellor.

We used our discretion to go straight to an Investigation. The retailer told us it suggested the customer contact a financial counsellor for an assessment so that it could tailor the payment plan after six months to be more sustainable. It said it was willing to create a payment plan for six months at $50 per fortnight as requested. It had previously offered Freya multiple payment plans under the Payment Difficulty Framework and a Utility Relief Grant Scheme payment was applied in 2019. Freya was also receiving a concession and the retailer confirmed she was on the best tariff.

The retailer committed to having its hardship team contact the customer within two weeks of closure of the case to discuss the payment plan of $50 per fortnight and to work with Freya to help her reduce her usage. Freya was satisfied with the resolution and we closed her case.

* Names have been changed

Broker call leads to transfer of electricity

TRANSFER WITHOUT CONSENT | MARKETING

Case number: 2021/3197

Alice*, a senior customer on an Age Pension, contacted us about a transfer of her electricity. She told us she received a call from Electricity Monster, a broker service that offers customers a comparison service on electricity plans from its partners. The service receives a fee for referring customers to its partners. Alice told us Electricity Monster asked her if she would like to sign up with its partner. Alice said she told Electricity Monster that she would think about it and, the next day when the broker called back, she told it she did not want to transfer. She said her original retailer told her she had been transferred to the partner retailer, despite not receiving a welcome pack. She wanted her electricity transferred back to her original retailer.

We raised an Assisted Referral on Alice’s behalf. She returned to us to let us know that the new retailer had confirmed it would retrospectively transfer the billing rights back to her original retailer but that she received a letter discussing her account with the new retailer. She was concerned her account had not been transferred back to her original retailer.

We started an Investigation to try to resolve Alice’s issue. The new retailer apologised to Alice for the inconvenience the matter may have caused. It confirmed that it had transferred the billing rights back to her original retailer. We checked the national database and confirmed that Alice’s billing rights were back with that retailer. The new retailer confirmed it had removed Alice from its marketing database. Alice confirmed she was satisfied with the outcome of her complaint and we closed her case.

* Names have been changed

Elderly, non-English speaker disconnected from power

ACTUAL DISCONNECTION | ELDERLY

Case number: 2021/3065

We found out about Jelena’s* situation at an outreach Bring Your Bills event. Jelena was dissatisfied with her retailer because her electricity had been disconnected. She believed she owed $415 and normally pays her bills on time. She is a public housing tenant, is on the Age Pension and was distressed that her electricity had been disconnected. She said she received a disconnection warning notice and tried to call the retailer but could not get through.

We lodged a discretionary Investigation, bypassing the Assisted Referral stage because of Jelena’s age and the fact she does not speak English. Working with one of Jelena’s family members and the retailer, we made sure Jelena’s electricity was reconnected. The retailer advised that it had made numerous attempts to contact Jelena leading up to the disconnection. It advised that payment had now been received. We made several attempts to get confirmation that Jelena’s son was authorised to act on her behalf. We were unable to get authorisation and so we had to close the investigation, noting the resolution the retailer had agreed to.

* Names have been changed

Outreach

Our focus on community outreach and engagement supports our goal of increasing accessibility and awareness of EWOV while building relationships with organisations that work with Victorian energy and water consumers who may be at the greatest risk of experiencing financial vulnerability.

In February, we co-hosted an energy and tenancy vulnerability roundtable with Financial Counselling Victoria (FCV). The event focussed on the broader Gippsland region, with presenters including Anglicare Victoria, Tenants Victoria and our Ombudsman Cynthia Gebert, sharing insights with attendees from local and state government, financial counsellors, housing advocacy and support agencies, legal services and local community support agencies. Bushfires and COVID-19 have slowed the recovery phase for many. An increased need for emergency relief highlighted the vulnerability of some in the community, with a new cohort accessing support services for the first time. Energy and housing issues often have flow-on effects with unintended consequences such as child protection notifications resulting from the disconnection of energy or the risk of homelessness.

In March, we attended our first face-to-face outreach event since March 2020. The Bring Your Bills day, organised by Hume City, was held at the Broadmeadows community hub and coincided with the distribution of emergency relief packs to Culturally and Linguistically Diverse (CALD) community members. Discussions with community members highlighted the level of financial vulnerability they were facing in regards to energy bills. A number of community members shared that they were often unable to make payments and they feared disconnection of supply. We were able to explain the importance of maintaining contact with energy and water companies, and the use of interpreter services where they felt they were not able to engage confidentially.

We also presented to the FCV Western Region Financial Counselling Network Meeting, exploring the impact of tourism drops and the flow-on effects for small business and household financial vulnerability, and to the St Vincent de Paul Social Justice and Advocacy Forum, exploring awareness of energy customers' rights and responsibilities, and the minimum requirements under the Payment difficulty framework.

Scheme participants

In our Data Hub, you'll find the latest quarterly case data for all of EWOV's scheme participants.

Systemic issues

From January to March 2021, we closed nine energy systemic issues identified through our case handling.

Payment reminder notices non-compliant

Reminder notices sent by an energy retailer didn’t provide details of how to contact the retailer about a complaint and dispute, in breach of clause 109(5)(d) of the Energy Retail Code. The retailer amended its disconnection warning letters, making them compliant, but didn’t agree that the original notices were non-compliant. We sought the Essential Services Commission’s (ESC) advice and it agreed that the retailer had breached the clause. Of the 248 customers disconnected after receiving the notices, the retailer provided a note on the customers’ accounts about contacting the retailer about a Wrongful Disconnection Payment (WDP). SI/2019/27

Planned outage notice left to owners’ corporation

A distributor did not notify apartment residents in a mixed-use building of a planned outage, instead relying on the owners’ corporation to notify the residents. The corporation placed a notice in the lift and distributed leaflets but these did not include a 24-hour contact number for the distributor. As a result of our investigation, the distributor reviewed the case and amended its process to ensure that the Energy Distribution Code (EDC) would be followed in the future, regardless of the entities involved. SI/2020/42

Retailer system leads to refund delays

Insufficient funds in a retailer’s refund account led to refund rejections in November and December, affecting 170 customers. The retailer payment provider did not subsequently update the refund status. The IT team has since corrected the issue with the provider and improved the refund process. All affected customers have since received their refunds, except for seven customers who provided incorrect banking information and from whom the retailer is currently awaiting updated information. SI/2021/9

Customers not informed about a network tariff change

A retailer failed to inform customers that their network tariff had changed to a cost-reflective tariff from 1 January 2017 and was also reversing and reissuing bills without informing customers of the reason. Some customers received a new contract pack including demand pricing because of a renewal, product change or meter change. For these customers, the retailer agreed to credit any demand charges previously billed up to the date they received the demand pricing information. For customers who were never notified, the retailer agreed to re-bill the customers without any demand charges and revert these customers to their original non-demand tariff. SI/2020/2

Water in distributor’s gas lines

We identified an increase in complaints about water in a distributor’s gas lines. The ongoing issue had caused outages for several customers. In some cases, the distributor has the area scheduled for mains replacement. In other areas where gas can’t be upgraded or where mains renewal is not in the immediate future, crews try to resolve issues over a period that can take several weeks, causing frustrations for customers. The distributor agreed to liaise directly with customers to ensure there is minimal impact during these periods. In some cases, this may lead to the provisioning of electrical appliances to customers, reimbursement of out-of-pocket expenses or arrangement of trades to assess customer assets. SI/2020/31

No hour of power

A retailer failed to provide a free hour of electricity in line with its contract. The retailer also didn’t give notice that smart meters do not change to reflect daylight savings time and so customers could not consider the time of usage. After our investigation, the retailer re-billed the affected customers and explained the issue to them. It also ceased the offer so that it would not affect future customers. SI/2020/47

Inappropriate material

A customer complaint led to an investigation into marketing material that may cause offence to people affected by mental health issues. The retailer withdrew the material after receiving the complaint. SI/2021/26

Ombudsman information on website

We reviewed scheme participants’ websites and identified a retailer that did not have the necessary ombudsman information contrary to section 56(1)(b) of the Energy Retail Code. Two employees at the retailer were also unable to locate EWOV’s information on the website. Following this, the retailer identified a PDF document on the website that listed EWOV’s information, however, this PDF was not easy to locate and the website did not include a search function. The retailer agreed to move the information to a more easily accessible location on its homepage. SI/2021/22

We identified another retailer that didn’t have the necessary ombudsman information on its website. The retailer confirmed in a web chat that EWOV was not included as the retailer was new to the Victorian market. The retailer took action to include EWOV on its website and the information is now more easily accessible. SI/2021/23

Public submissions

Draft determination – Billing contents and billing requirements

Australian Energy Market Commission (AEMC)

We contributed a joint comment with the Queensland, New South Wales and South Australian energy and water ombudsman services in response to a draft determination about proposed reforms aimed to improve consumer experiences with, and understanding of energy bills. We supported the draft decision in principle.

Read the comment

Exposure draft - National Consumer Credit Protection Amendment (Debt Management Services) Regulations 2021

Treasury

We contributed to a joint submission with the New South Wales, South Australian and Queensland energy and water ombudsman services in response to a proposed amendment to consumer credit protection. We offered our collective experiences with credit repair companies and outlined the rise in energy debt in the market. We indicated our support for requiring previously unregulated entities to obtain an Australian credit licence but we outlined concerns that the conditions of the licence will not apply to the conduct of those entities in relation to energy or water debts.

Read the submission

Issues paper – Embedded Networks Review

Department of Environment, Land, Water and Planning

We made a submission to the Embedded Networks Review Issues Paper. In the submission, we outlined the state of complaints within Embedded Networks, including challenges customers face, such as billing errors, high billing and billing tariff complaints. We responded to all questions in the Issues Paper, including about microgrids and improving the consumer protections of embedded network customers.

Read the submission

Glossary

Visit the Data Hub for a full glossary of terms.