When can you be disconnected for non-payment of your electricity bill?

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As an essential service, the disconnection of electricity can have a devastating impact on you as a customer. Because of this, the National Energy Retail Law is clear that disconnection of electricity for customers in financial hardship, where bills are unpaid, is a last resort (see section 47).

In addition, up until at least 31 July 2020, due to the COVID-19 pandemic, no residential customers can be disconnected without their consent where they may be in financial stress.

In this update, we set out the general rules that apply to the disconnection of a residential electricity customer for non-payment.

What does disconnection mean?

In Australia, the terms ‘disconnection’ and ‘de-energisation’ are used interchangeably to refer to the altering of a connection to prevent the flow of energy. In Queensland, New South Wales, Australian Capital Territory, Tasmania and South Australia, the rules for disconnection are set out in the National Energy Customer Framework (NECF). Our focus in this update is on the disconnection of electricity (rather than gas) customers.

This update only sets out the rules as they apply in NECF states and territories. Note, however, that the rules for disconnection are similar in all Australia states and territories. Note also, that we are only considering the rules that apply to customers directly connected to the electricity grid. Slightly different rules apply to customers who are based in apartment buildings, shopping malls, caravan parks or retirement villages with private electricity networks in place, otherwise known as ‘embedded networks’.

A disconnection must be distinguished from a planned or unplanned ‘interruption’, which is a temporary stopping of supply to the premises. This may be planned in order to replace a meter or upgrade infrastructure. Or it may be unplanned, such as where supply is stopped due to an extreme weather event.

Before the disconnection process begins

There is a rigorous process that must be followed in order to disconnect residential customers for non-payment of bills. But before this begins, on your non-payment, if you are a residential customer, you should be offered the opportunity to pay by instalments. If you do not agree to doing so, or you agree but fail to comply with the instalment arrangements, the disconnection process can begin. The amount due must be at least $300.

The steps of the disconnection process

The disconnection process can proceed as set out in National Energy Retail Rule (‘NERR’) 111:

1. Your retailer is required to send you a bill which sets out the amount owing, when you must pay it by, and the acceptable payment methods;
2. If full payment is not made by the due date, the retailer must send you a reminder notice;
3. If you do not pay by the deadline indicated in the reminder notice, you must be sent a disconnection warning notice;
4. After you have received a disconnection warning notice, and you have not made full payment after a certain period of time, your retailer must use their best  endeavours to try and contact you;
5. If you still haven't paid or contacted your retailer to discuss payment of the debt, you may be disconnected.

When Is disconnection not allowed?

Even if the process set out above is followed, there are certain situations where a customer cannot be disconnected. These situations, set out in NERR 116, include:

• Where someone at your premises has life support needs;
• Where you have made a complaint relating to the disconnection and it is yet to be resolved;
• Where you have raised an issue of ‘explicit informed consent’;
• Where you are a financial hardship customer and you are following a payment plan;
• Where you have applied for an energy concession or rebate, and you are yet to hear back on whether you are eligible;
• Where your failure to pay relates to something other than the sale of energy;
• Where the premises are to be de-energised during an extreme weather event;
• During a ‘protected period’ (for example, on a weekend of public holiday).

Conclusion

As a residential customer, you  can only be disconnected for not paying your bills under strictly limited circumstances, and in accordance with the process set out in the NERR. If you become aware that you are about to be disconnected for non-payment, or you have been disconnected, immediately get in contact with you retailer to sort it out.