Bad Debt

Ofgem Calls For Fair Treatment In Light Of Bad Debt

In its latest report on vulnerable customers, Ofgem has confirmed that, although the number of
customers in debt has fallen from 9% for gas customers and 3% for electricity customers in the past
year, the monetary amount has grown. The average amount owed has increased by 7% for
electricity customers and 5% for gas customers during the same one-year period.

New research has shown that some suppliers allow for a significant build-up of debt before
repayment commences. As such, the regulator has called for suppliers to monitor and alert
customers in situations of severe debt and implement management strategies. In some cases,
customers accrue an average of £600 before suppliers step in to help with steps for debt

The report further outlines areas in which suppliers have offered help to such clients to assist in daily
energy management. These measures include free gas safety and meter readings and such initiatives
may account for the good progress seen in some areas within the industry.

Ofgem’s Senior Partner for Consumers and Competition, Rachel Fletcher, has commented that
Ofgem will be closely monitoring suppliers to ensure a reduction in debt amounts. Ofgem has
instituted overarching rules under which suppliers will have to show that they have identified and
taken extra steps in the fair treatment of vulnerable customers.

It makes good business sense to sporadically request quotes and compare energy tariffs to see if you
are getting the best value for money from your energy contract. Contact BAS and one of our
electricity and/or gas specialists will happily assist by negotiating the best rates and coming up with
tailor-made energy strategies to fit your business requirements.


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