Debt Flagging for Electricity & Gas Customers – Industry Code

1. Debt Flagging for Electricity & Gas Customers – Industry Code CER, GMARG/IGG August, 2011

2. Background & Decision • Customer Bad Debt in Elec & Gas Markets • CER Consultation – March 2011 • Options Debt Flagging & Blocking • Decision Issued – June 2011 • Debt Flagging • Domestics & Small/Medium Business • Excludes; • Electricity – LEUs: DG 7-10 & TCon • Gas – DM & LDM

3. Decision • Implement a debt ‘flag’ • Monetary & Timing Thresholds • No Contract Default or Debt Assignment • Industry Code on Debt Flagging • Define Finer Customer Details • Reporting/Monitoring • Review after 1 year • Implementation • 1st October 2011 • Integrated Solution: 1st January 2013

4. Industry Code • Discussion on Main Aspects • Gas Industry → GMARG, 3rd August • Electricity Industry → IGG, 10th August • Feedback Received • Input into Draft Code • Code Consultation • Code Approval

5. Industry Code - Principle Areas • Applicability • Processes • Grounds to Raise a Flag • Thresholds/Issues e.g. Change of Tenancy • Customer Communications • Notice to Customer of Industry Process • Notice to Customer where flag raised • Timings • Reporting

6. 1. Applicability • All Suppliers of Electricity & Gas; • Domestics & Small/Medium Businesses • Excludes; • Electricity – LEUs: DG 7-10 & TCon • Gas – DM & LDM • Relates to process operational from 1st October 2011

7. 2. Process Implementation • Gas • BGN Proposal • G208RQ Change of Shipper Cancellation Request open to Outgoing Supplier • Electricity • RMDS Proposal: Working Process 0020 Debt Flagging • Mostly Manual Process given Harmonisation Project – MPRN Lists between Outgoing/Incoming Supplier & MRSO

8. 3. Grounds to Raise a Flag (I) • As per decision; • From when amount fell due, not bill issued, this typically 14 days from bill issued.

9. 3. Grounds to Raise a Flag (II) • Outstanding Deposits Excluded • Cannot Raise a Flag where customer pursuing complaint re monies owed • Must adhere to Industry Thresholds & Timings • Raising Flag is Not Optional • Duel Fuel: Cannot flag for Electricity CoS where debt criteria met on Gas account & vice versa

10. 3. Grounds to Raise a Flag (III) • Change of Legal Entity • Cannot flag new tenant CoS where debt accumulated by previous tenant • Elec: CoLE signalled on 110 message, old supplier cannot raise flag • Gas: Not signalled → Options: • Before Flag: Old Supplier contact customer to confirm still in resident when receive G204N • After Flag: New Supplier contact customer to confirm that customer is not new resident • When informing of CoS Cancellation?

11. 4. Customer Communication (I) • Communication Re Flagging Process • Data Protection Considerations • Customer must be aware of industry flagging process at point of sign up • Options: • Suppliers include relevant provisions in t&c • Customer explicitly indicate agreement that account may be flagged when signing contract

12. 4. Customer Communication (II) • Communication Re CoS Cancellation • Customer must be advised where CoS is cancelled on the basis of a debt flag. • Options • New Supplier contacts customer • Losing Supplier contacts customer • Both New and Old Supplier contacts customer

13. 5. Timings • Number of business days required: • Outgoing Supplier to raise a flag • Incoming Supplier to proceed or cancel CoS • Customer to be contacted where CoS Cancelled • 2-3 business days? • Align with cooling off period?

14. 6. Reporting • CER monitoring debt flagging process • On monthly basis, receive from DSOs • # CoS requests flagged by losing supplier • # CoS cancellations following flag • CER will spot check M/GPRNs which were flagged with suppliers from time to time • Review after 1 year

15. Next Steps • Input any GMARG/IGG feedback into draft code • Responses – 17th August 2011 • To: efarrelly@cer.ie