Britain saw a “record low” number of disconnections by energy suppliers last year despite millions of consumers having outstanding bills as the number of people who agreed to repay their debts rose.
Around 1.3 million electricity and 1.1 million gas consumers – or 5% – were in debt in 2012 but there were only 557 disconnections – half as many electricity disconnections and two thirds fewer gas disconnections than in 2011, according to Ofgem’s latest Social Obligations Report.
It follows the regulator’s requirements for energy suppliers to take into account the customer’s ability to pay when agreeing repayment plans and only to disconnect as a last resort.
Suppliers reported that repayment arrangements agreed in 2012 allowed customers twice as long to repay their debt as those agreed in 2010 – 35% of customers repaying a debt were paying less than £3 a week. They saw a 16% rise in customers – associated with 900,911 electricity accounts and 802,469 gas accounts – repaying debts last year compared to the end of 2011.
Sarah Harrison, Ofgem’s senior partner for Sustainable Development said with energy bills rising, it is “important than ever before” that suppliers do all they can to help customers.
She added: “Ofgem’s regulations put obligations on suppliers and provide protection for consumers and today’s report shows how suppliers are responding to these requirements. Levels of disconnection are at an all-time low and suppliers are working to help customers in debt. But that is not enough. Suppliers must continue to reach out to consumers and promote free consumer services and help that is available to manage energy bills, working even more closely with debt and consumer advice agencies.
“As today’s report shows, Ofgem will monitor the action of suppliers, large and small and the way they treat customers who are in debt and need help.”