Increasing uptake of PAYG meters linked to fall in gas disconnections

CER’s focus on free PAYG meter installations could be paying dividends

Eoin Clarke
by Eoin Clarke on 7th February, 2014

The number of electricity and gas disconnections decreased during the third quarter of 2013 according to the latest report from the CER.

Figures from The Commission for Energy Regulation’s Q3 2013 Electricity & Gas Retail Markets Report showed that domestic gas disconnections for Bord Gáis Energy dropped from a figure of 1,556 to 1,420 between the second and third quarters of 2013. The fall in the number of gas disconnections during the 3 month period could be partially linked to increasing uptake of gas Pay as You Go Meters (PAYG).

The decrease comes at a time when Ireland’s independent energy regulator has been working hard within the domestic gas and electricity market to facilitate the free installation of electricity and gas PAYG meters, for customers who are experiencing financial difficulty.

And it seems that this effort has been met with some success, with the number of electricity PAYG meters installed climbing from 7,323 to 7,336 between Q2 and Q3 2013.

However, the number of gas PAYG installations actually decreased across the same period, according to figures from the CER, falling from a figure of 6,680 to 4,192 – a quarter-on-quarter decline of 37.25%.

While this has been explained by ‘seasonal effects’ in the report, this may call into question the correlation between gas Pay as You Go Meters (PAYG) uptake and falling gas disconnection rates for Bord Gáis Energy .

Gas & electricity disconnections

Bord Gáis Energy was also the only energy supplier included in the report to see a fall (-1.7%) in domestic gas disconnections between the second and third quarter of 2013. The remaining three suppliers all saw an upward trend in their domestic gas connection figures over this period. This was as follows: SSE Airtricity (+4.9%), Flogas Natural Gas (+61.3%) and Electric Ireland (+77.3%).

An increase in debt flagging in the gas market also appeared to reflect the increase in gas disconnections.

Debt flagging is the process by which an existing supplier flags up a customer’s outstanding debt to a new supplier if it sits above industry thresholds approved by the CER. The latter can then decide whether to proceed with the switch.

Total debt flags in the gas market rose from 382 to 439 between Q2 and Q3 2013, while these respective figures stood at 1,558 and 2,176 for the electricity market.

However, the picture was more positive when it came to domestic electricity disconnections.

Here figures were only provided for three energy suppliers, with Bord Gáis Energy the only one to see an increase (+3%) in domestic electricity disconnections between Q2 and Q3 2013.

Falls in domestic electricity connections over the same period were recorded for Electric Ireland (-8.9%) and SSE Airtricity (-26.9%).

Looking at the domestic gas and electricity market as a whole, Bord Gáis Energy had the highest number of domestic disconnections, when adjusted for market share, while Flogas Natural Gas had the highest disconnection rate per 10,000 customers.

Electric Ireland reported to have the lowest domestic disconnection rate per 10,000 customers.

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