Warning over energy bill shock

ENERGY customers paying a bill just a day late are in danger of being slugged up to hundreds of dollars extra.

ENERGY retailers are stripping up to hundreds of dollars extra from customers who pay a bill as little as a day late, consumer experts warn.

Householders signing on to conditional electricity and gas discount deals risk crippling bill blowouts if they don’t meet contract rules such as paying on time.

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A concession customer who faced an additional $560 charge for paying a high quarterly electricity bill late is among those to seek Consumer Action Law Centre help.

The Andrews Government recently backed an independent energy review’s recommendation that “costs incurred by customers for failing to meet offer conditions are to be capped and not be higher than the reasonable cost to the retailer”.

Conditional discount offers could painfully backfire for customers struggling to pay.

In a submission to a consultation paper, Consumer Action says the reform should be urgently introduced.

“Marketing based on pay-on-time discounts continues to escalate and imposes a disproportionate penalty to those who do not pay on time — often when they simply cannot afford to do so,” it argues.

Consumer Action senior policy officer Zac Gillam said conditional discount offers were rife.

They could painfully backfire for customers struggling with energy costs, as paying even just a day late usually meant losing their full discount.

“The range of pay-on-time discounts has traditionally been 15 to 30 per cent, but appears to have shifted more towards 20 to 40 per cent in recent times,” Mr Gillam said.

Consumer Action has also raised concerns about retailers refusing to accept customers with poor repayment histories.

Customers on discount deals who pay bills past the due date may have to pay up to hundreds of dollars.

“We’ve recently had calls from households who have been denied a market electricity contract due to credit reporting issues when moving into a new property.”

Mr Gillam said this was among reasons why retailers should be compelled to offer a no-frills “basic service offer” set at a fair, regulated price.

The government is still considering that proposal, along with a recommendation to abolish expensive default “standing offers”.

The Australian Energy Council did not respond before deadline.

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@KarenCollierHS