10% of Bord Gáis users in arrears

ONE in 10 Bord Gáis customers are in arrears of €100 or more on their bills.

However, the number of customers in arrears of 60 days or more is down from 115,000 in May to 103,163 at the end of September.

There is also a €9 million bad debt provision in the energy company’s accounts for this year. This is to provide against losses from customers who leave Bord Gáis Energy to go to other suppliers without settling their bills.

The company stressed that it seeks full payment from all customers who move to new providers and that the provision is a “prudent accounting move” to protect against future losses.

The figure does not represent money “written off” through bad debt this year – it is an accounting provision.

“With the new debt blocking protocol we expect to see a reduction in the numbers of customers moving to new providers without settling their accounts,” said a company spokesperson.

In total, 90,500 customers have arrears of €100 or more.

Bord Gáis said it has been proactive in managing the issue of bad debt. The rate of disconnections has fallen 33%, from 3,540 between January and August 2010 to 2,393 between January and September 2011.

The company said disconnection is an “absolute last resort” for customers who do not engage with them to agree a repayment plan or a pay as you go meter.

Bord Gáis has agreed 63,000 payment plans with customers already this year compared with 31,500 for the whole of 2010.

It has installed 13,161 pay as you go meters this year against just under 1,000 in the same period last year.

Last year, Bord Gáis wrote off €26.4m in bad debts.

The company recorded pre-tax profits of €120m last year. Bord Gáis now has about one million customers, including 460,000 electricity customers.

Its electricity prices increased 12% from August while its gas prices increased 22% this month.

“We recognise the strain that households are under at the moment and we have done our utmost to limit the overall price increase to 12% despite much higher increases in international wholesale prices,” said Jason Scagell, managing director of retail and trading at Bord Gáis Energy.

“The prices paid by Irish customers are intrinsically linked to international wholesale prices and with the markets signalling the prospect of higher winter prices, residential price increases have unfortunately become unavoidable.”

The average annual Bord Gáis residential electricity bill is €989 and gas bill is €689.