Michael Joseph Hirrell

(nPower) 

HM  Coroner 
The Town  Hall 
Town  Hall  Square 
Leicester 
LE1  9BG 

Director.  External  Affairs 

251h  November 2013 

Dear Mrs  Brown, 

Re:  Mr Michael Joseph Hirrell 

I write with  reference to  your report in  connection with  the death of Mr Hirrell,  made in 
accordance with  Regulation 28  Coroners (Investigations) Regulations 2013. 

First  I should  stress  that,  as  stated  at  the  inquest on  23  September  2013, we  were 
deeply shocked and  saddened to  learn of Mr Hirrell's death.  I take this opportunity to 
express our condolences to  the family and friends of Mr Hirrell.  When we were made 
aware  of Mr  Hirrell's death  by your office, we  immediately launched  an  investigation 
into  the  circumstances  surrounding  the  disconnection  of the  electricity  supply  at  the 
property.  This  letter covers  our procedures for dealing  with  disconnections affecting 
domestic consumers,  across both our domestic and  non domestic businesses. 

The  steps taken  by npower,  as  described  to  you  at the  inquest,  are  permanent.  The 
only measure not yet formally adopted  on  a permanent basis is  our trial to assess the 
impact  of  not  disconnecting  shared  commercial  and  domestic  supplies  during  the 
winter months. 

Domestic 

Suppliers  are  required  to  abide  by  provisions  set  out  in  electricity  and  gas  supply 
licences.  Domestic  customers  generally  (for  the  sake  of  clarity  in  this  response, 
customers  who  reside  in  domestic premises and  contract with  their supplier direct for 
electricity  and  gas  are  known  as 
'domestic  customers')  are  afforded  certain 
protections  under the  supply  licences,  in  particular where  they are  classed  as  being 
part  of  a  particular  vulnerable  group  and  in  debt.  These  provisions,  together  with 
Energy  UK's  Safety  Net,  provide  significant  protection  for  vulnerable  domestic 
customers in  debt. 

Cont'd 

RWE  npower 

Windmill  Hill  Business  Park 
Whitehill  Way 
Swindon 
Wiltshire 
SNS  6P8 
United  Kingdom 

T  +44 (0) 1793  892825 
F  +44  (0)1793  892631 
I  www.rwenpower.com 

Registered  office: 
RWE  Npower  Group  pk 
Windmill  Hill  Business  Park 
Whitehill  Way 
Swindon 
Wiltshire 
SNS  6P8 
United  Kingdom 
Registered  in  England 
and  Wales  no.  8241182

An ijWs company 

 
 -2-

The  supply  licences  prohibit  the  disconnection  of  any  domestic  customer  in  debt 
unless  the  supplier  has  taken  all  reasonable  steps  to  recover  the  money  owed 
through  fitting  a  prepayment  meter,  where  it  is  safe  and  reasonably  practicable  to 
install one. 

Suppliers  are  explicitly  prevented  between  1  October  and  31  March 
from 
disconnecting  premises  where  the  customer is  a  pensioner and  lives  alone,  or lives 
only with  other pensioners or persons under 18.  Furthermore, suppliers must take all 
reasonable  steps  to  avoid  disconnecting  between  1  October  and  31  March  a 
domestic  customer's  premises  where  one  of  the  occupants  is  a  pensioner,  is 
chronically ill  or is disabled. 

In  addition  to  this,  the  Energy  UK  Safety  Net  (which  has  been  in  existence  since 
2004  and  to  which  npower  is  a  party  and  abides  by  its  provisions)  prevents  the 
disconnection,  knowingly,  of  any  vulnerable  domestic  customer  at  any  time  of  the 
year.  Under the Safety Net: 

"A  customer  is  vulnerable  if for  reasons  of age,  health,  disability  or  severe 
financial insecurity,  they are unable  to  safeguard their personal welfare  or the 
personal welfare of other members of the household" 

As  can  be seen , the  definition is  extremely wide and,  so, can  encompass a variety of 
circumstances. 

Finally,  npower applies  its  own  winter  moratorium,  whereby  between  1 October and 
31  March , no domestic customer who has a debt will  be disconnected. 

The  Energy UK Safety Net's domestic customer provisions are independently audited 
every year by an  outside firm  of auditors appointed by Energy UK.  The results  of the 
supplier audits  are  shared  with  Ofgem  and  the  statutory  consumer  body  that  deals 
with  energy matters - Consumer Futures. 

Our  staff  in  the  field  are  trained  to  look  for  signs  of  vulnerability  when  visiting 
domestic customers ' premises; where  vulnerability  is  identified,  no disconnection  will 
take  place. 

The  interlocking  and  overlapping  provisions  set  out  above  provide  robust  protection 
for vulnerable  domestic customers.  The  licence  provisions  cited  are  enforceable  by 
Ofgem,  a  breach  of  which  can  lead  to  a  significant  financial  penalty  being  levied 
against a supplier, along with the adverse publicity that will  inevitably follow. 

Non domestic 

Before covering the  changes we  have  implemented,  I should  remind  you  that,  prior to 
this  incident,  we  had  in  place  well  established  procedures  for  identifying  and 
safeguarding vulnerable consumers from  disconnection, as was demonstrated  by the 
call  to action  briefing  of 19 December 2012 which  you  referred  to  at the  inquest.  To 
clarify, where  I refer to  a  'customer' throughout  this  letter,  this  also  includes  the  end 
user, regardless of whether or not they are the registered account holder. 

 -3-

As  you  are  aware,  we  have  signed  up  to  Energy  UK's Safety  Net,  and,  in  2009,  we 
made a voluntary commitment to  never knowingly disconnect a vulnerable person. 

Our  policy  and  processes  in  this  area  are  well  documented  and  supported  by  local 
working  procedures  for  advisers.  Where  there  is  any  doubt  about  potential 
vulnerability,  we  instruct  our  staff  to  err  on  the  side  of  caution  and  to  halt  any 
disconnection . 

The  issue  of  shared  commercial  and  domestic  supplies  is  a  complex  one  which 
affects  all  energy suppliers  nationwide.  Although  it  may appear easy to  resolve  this 
type  of  scenario,  in  practice  this  involves  the  co-operation  and  co-ordination  of  a 
number  of  parties,  including  the  landlord  of  the  property  and  the  local  distribution 
company.  Where  a  vulnerable  consumer  has  been  identified  in  an  adjoining 
domestic flat  and  where there  is  no  alternative  solution  our process  is  to  pursue  any 
outstanding  debt via  other means,  such  as  court  proceedings,  to  prevent the  supply 
from  having to  be disconnected . 

Following  our  review  of  Mr  Hirrell's  case,  which  was  carried  out  at  a  senior  level 
within  the  organisation,  we  agreed  a  number  of  further  enhancements  to  our 
procedures within  npower's  non  domestic division.  These  enhancements,  which  are 
all  now in  place,  are as follows : 

The warrant officer on  site  now has the ultimate authority not to proceed  if 
he/she is  uncomfortable with  the disconnection of a supply.  This means that, 
should there be any concern over the consumer's welfare or personal 
circumstances, the agent is empowered to  walk away without proceeding with 
the disconnection.  Previously,  the Npower debt team  handling the call made 
the final  decision;  however, it is clear that those on  the ground are best 
placed to make this assessment; 

A clear,  procedure has been  introduced so that,  should a debt collection 
agent be  concerned about the welfare of a customer,  he/she can  escalate the 
case to one of a number of senior managers within  Npower; 

When we attend a property at either the  POV (pre disconnection visit) or at a 
warrant stage, additional checks have been  introduced, whereby Npower debt 
advisers ask further probing questions to  identify shared  commercial and 
domestic supplies,  including asking for details of any potential vulnerability at 
the  site.  Our approach to  recording this information  has now been 
standardised using a new checklist, which  includes asking the field  agent to 
look for adjoining flats,  shared  meter cut-outs,  etc.  Where such a situation  is 
reported,  we then  carry out further investigations within  Npower,  prior to 
proceeding with  any disconnection action.  In the past,  we were  reliant on  the 
agent in  the field  to  proactively report any potential vulnerability to  us, 
whereas,  now,  we  ask further questions as a matter of course; 

 -4-

We have strengthened the audit trail  on any accounts which proceed to an 
escalated  stage of the  debt collection  process,  so  that all decisions and 
details of how they were reached  are clearly documented throughout.  We do 
this via  a checklist which all  of our advisers have access to,  along with (for 
electricity customers) some enhancements to  our system, which  provide a 
clear, chronological sequence of events and  those  responsible at each  stage. 
For gas customers,  due to  system  constraints, this information is  recorded  in 
a standard template ; however, all  of the same information is captured.  As 
you  will recall,  on  this occasion there was inconsistency between our records 
and  the evidence provided  by the warrant officer, and  these additional 
measures are designed to  remove  such a risk  in  the future ; 

In July 2013 we  carried  out a face to face briefing with all  of our debt 
collection agencies (internal and  external),  setting out our amended  policy 
and  procedures for dealing with  shared supplies and  vulnerable customers , 
and clearly explaining the  part they have to  play in  this .  Further details were 
then  provided to the agencies  in  writing, to  ensure clarity and  consistency, 
and we intend to repeat this at least annually; 

All  affected teams within  npower's debt management area  have already 
received  a briefing  on  the changes to our process, and we  are in the process 
of organising a face to face training session to  reinforce these important 
messages.  We have committed to carrying out refresher training  in this area 
at least annually. 

In  additional to this, we  have introduced  a trial  period on  the cessation of the 
complete disconnection of shared  commercial and  domestic supplies during the 
winter months (i.e.  October to  March).  We began trialling  this from  01  October 2013 
and , as with  any major change of this nature, we  intend to  review the  results and 
reflect on any learning points,  prior to  rolling  out any permanent change in  policy. 
For the avoidance of doubt, this  is  in addition to the measures we  already have in 
place to safeguard  vulnerable customers throughout the  year, by extending the  same 
protections to  all  domestic consumers during the winter months. 

Clearly Ofgem and  Energy UK are fully aware of Mr Hirrell's case and we will 
continue to work with  them  going forward .  We have  provided  both Ofgem and 
Energy UK with complete copies of the transcript of the Inquest. 

I trust that the information  set out above will  serve to  reassure you that we take the 
welfare of consumers extremely seriously, particularly those who are  vulnerable , and 
that we  have already taken steps to  strengthen our already well  established 
procedures as a result of this tragic incident.  We are committed to ensuring the 
safety of consumers. 

 -5-

Should you  require clarification on  any of the points covered  in  my response then 
please do  not hesitate to  contact me. 

Yours sincerely 

c.c. 

,  Head of Consumer Affairs,  Ofgem,  9 Millbank,  London SW1 P 3GE 

,  Chief Executive,  Energy UK,  5-11  Regent St, London SW1Y 4LR

LEICESTER  CITY & 
SOUTH LEICESTERSHIRE 
CORONERS DISTRICT 

. 2 DEC  2013 

RECEIVED 

Date:  28  November 2013 

HM  Coroner 
Leicester City and  South 
Leicestershire 
The Town  Hall 
Town  Hall  Square 
Leicester 
LEl  9BG 

Dear Mrs Brown, 

Michael Joseph Hirrell 

Thank you  for your letter dated  3 October enclosing  a copy  of your Regulation  28 report 
regarding  Mr Hirrell.  We  are aware that you  have also corresponded  about this matter with 
npower and  Energy UK,  and  that both  will  be submitting  responses to you. 

I  have set out below the current protections in  place  for domestic consumers.  Wh ilst I 
recognise that you  may already be  familiar with some of this information I  consider it would 
be helpful  to restate this for completeness.  In addition  to this information, I  have also  set 
out our proposals  to take forward the issues  identified in the report. 

1.  Current protections 

Supply licence conditions - debt recovery, and disconnection 

There are strict rules  in  place to protect domestic customers who  may  be  threatened  with 
disconnection or who  are struggling to pay their energy bill . Disconnection  should only be 
used as a  last resort and  we  expect suppliers to actively seek out alternative solutions to 
disconnection wherever  possible. 

If a domestic customer is having  difficulty in  paying their gas  or electricity charges,  the 
domestic supplier must offer to  recover the charges directly from  social security benefits  if 
the customer is  in receipt of social  security benefit or by regular instalments or via  a 
prepayment meter. The supplier must take all  reasonable  steps  to ascertain  the customer's 
abil ity to pay  and  to take this into account when  calculating instalments. The supplier  must 
not disconnect a domestic premise unless it has taken  reasonable steps  to recover the 
charges. 

Energy suppliers must not disconnect, in Winter ( by  which  we  mean  the six  months 
between  October to  March),  a domestic premise  where the customer is or the supp lier  has 
reason  to bel ieve  is of pensionable age and  lives alone or lives only with others who are 
also  of pensionable age  or under 18.  Domestic suppliers must  also ta ke all  reasonable steps 
to avoid  disconnecting,  in Winter,  a domestic premise if the occupants include a person who 
is of pensionable age,  disabled  or chronica lly sick. 

The Office of Gas and Electricity Markets 
9 Mi!lbanl- L 1ndon SW!P 1<:iE  Tel 020 7901  7000  Fax 020 7901  7%6 www.ofgem.gov.uk 

 
 
 
 Ofgem's monitoring of debt and disconnection 

Domestic gas  and  electricity suppliers are required  to report to Ofgem  every quarter giving 
information  on  their performance in  relation  to debt, disconnection,  prepayment meters, 
and  their services to customers in vulnerable positions.  Ofgem  monitors performance 
across  all suppliers in these areas, analysing the data  to identify trends  and  regularly 
meeting  with suppliers to discuss issues of concern. 

We  report on  suppliers' performance annually.  I  have enclosed  a copy  of our most recent 
report,  published  13  November 2013,  with this reply.  It showed  that domestic 
disconnections in  Great Britain  have fallen  from  2801  in 2010 to 557 in  2012.It also showed 
that the  majority of these disconnections occurred  because the supplier was  not able to fit 
a prepayment meter as an  alternative to disconnection.  We  receive information from 
suppliers regarding domestic supplies which  have been  disconnected  for reasons  of debt or 
in  error. Suppliers also  provide information  annually about the  number of domestic supplies 
they have disconnected  that should  have been  covered  by  the Safety Net. To  further 
monitor suppliers' use of disconnection,  for 2013  we  expect each  supplier to provide details 
of the process they have followed  for each  of the disconnections they carry out. 

Energy UK Safety Net 

The  six large domestic suppliers have agreed  a voluntary code  of practice - The  Energy  UK 
Safety  Net  - which aims to protect vulnerable domestic customers  from  disconnection. 
Through this code  of practice suppliers have gone beyond  the requirements of the supply 
licence,  committing to never knowingly disconnect a vulnerable customer at any time of 
year,  where for reasons  of age,  health,  disability or severe financial  insecurity,  that 
customer is unable to safeguard  their personal  welfare  or the personal  welfa re of other 
members of the household.  They have also  committed to reconnect customers  who are 
subsequently  identified  as  vulnerable as  a priority and  usually  within  24 hours. 

The  Safety Net sets out how suppliers will  put into practice the commitments they have 
made,  including  how suppliers will  attempt to engage  with  customers  who are  at threat of 
disconnection.  If a supplier does ultimately obtain a warrant to disconnect a domestic 
property they should  look for any signs  of vulnerability when  exercising  the warrant,  even if 
there is no  one  in  the property at that time,  and  where possible install  a  prepayment meter 
as  an  alternative to disconnection. 

Where  the domestic customer shares a  premise with,  and  takes a supply from,  a non-
domestic premise,  the Safety Net  requires  suppliers to ensure  that their business teams are 
aware of the Safety  Net provisions to  minimise the  risk that a vulnerable domestic 
customer is disconnected for reasons  outside of their control. 

The  Safety  Net is run  by Energy UK , the trade association  for the gas  and  electricity sector, 
and  compliance  with the Safety  Net provisions is  independently audited.  In our Social 
Obligations Annual  Report we stated that we expect the smaller domestic suppliers to 
follow  the lead  of the big six's commitment to  not disconnect customers in vulnerable 
positions at any  time of year.  We  are holding  a workshop  with these suppliers in January 
2014 to discuss best practice  in  debt and  disconnection. 

Ofgem letter - disconnection of domestic consumers in business premises 

On  20  December 2012  Ofgem wrote to all  non-domestic suppliers regarding their approach 
to non -domestic debt and disconnection,  and  also  set out our expectations of good practice. 
We  made clear that as  part of the  pre-disconnection site visit,  suppliers should  undertake 
checks  to establish whether there is a shared  occupancy i.e.  a domestic customer shares 
the supply with the non-domestic customer,  and to look for signs of vulnerable  customer 
occupancy.  In addition,  we  set our expectation  that all  suppliers should adopt the  principles 
of the Safety Net in  this  regard.  I  have enclosed  a copy  of this letter. 

The Office of Gas and Electricity Markets 
,  ..,.  llt.ank Lone.  m  SWlP .K~  Tel 02G  no1  7000  Fax '120 7901  7060  www.ofgem.gov.u... 

2 of 4 

 2.  Actions following the Coroner's report 

Ofgem's monitoring of debt and disconnection 

We  have set out above  the extensive information we  collect on  debt and  disconnection  from 
domestic energy suppliers. Following a review of that monitoring information,  we  issued  a 
formal  request on  25  October to all  non-domestic gas and electricity suppliers. In this we 
asked suppliers to provide  information  about the total  number of disconnections on non-
domestic sites where  the gas or electricity supply is shared  with  a vulnerable domestic 
customer. 

We  have requested  that this information be  collected  monthly by suppliers from January 
2014 onwards and  reported to Ofgem  on  a quarterly basis.  We  expect to receive the first 
data from  these suppliers at the end  of April  2014. 

We  intend  to discuss  with suppliers their approach to t reating  domestic customers  in shared 
occupancy situations as  part of our next regular meetings with  them. 

In the light of this case,  we  will ask  domestic and  non-domestic suppliers to report to 
Ofgem as soon  as  it becomes known to them  that there  has been  a fatality as  a 
consequence  of a  disconnection. 

Energy UK Safety Net 

We  met with Energy  UK  on  14 November to ask that they review  the  provisions of Safety 
Net covering the disconnection  of domestic customers  where  they take a supply from  a 
shared  non-domestic premise.  We  have written to Energy UK to highlight our expectation 
that these provisions  must be clearer to ensure that suppliers would  not proceed  with  a 
disconnection  of a vulnerable domestic customer  in  this situation.  I  have enclosed  a copy of 
this letter.  Energy UK  has acknowledged the  relevant clause  in  the Safety Net is  not fit for 
the  purpose and  is also  not reflective of suppliers'  current practices. 

Energy UK  has  committed  to  review this particular clause and  will  be  writing to suppliers 
shortly.  We understand  that Energy UK will  be  confirming this commitment to you  also.  We 
intend  to work with  Energy UK  as  necessary as  they progress their review of this clause in 
the Safety Net. 

Joint letter to suppliers with Consumer Futures 

We  intend  to write to all  non-domestic suppliers as  a follow up  to our letter of 20  December 
2012,  highlighted above. The letter will  be sent jointly with  the consumer body Consumer 
Futures,  with  whom we  worked  closely in  reviewing  suppliers' approaches to  managing 
non-domestic debt and  disconnection last year.  We  intend to give particular focus  in the 
letter to our expectations of how  non-domestic suppliers should deal with  situations of 
shared  occupancy of non-domestic premises with  domestic consumers.  We  expect to send 
this letter by the beginning of December and  will  send  a copy of this to you. 

Npower review of its practices 

npower has provided Ofgem with an  update on  its review  of its practices in  the light of this 
particular case.  We  note that the company has  made a number of changes which it has 
been  confirmed will  be  permanent features  of its processes.  We  understand  that npower 
will  be  setting  these out  in  its response to you.  We  have asked  npower to share details of 
these revised  processes  with Energy UK  to consider as  part of its review of the  Safety Net. 

The Office of Gas and Electricity Markets 
3  "11llbar k  Lor c.'o,i  SWlF  1C-E  Tel 02C  7901  7')00  Fax 020 7901 706b  www.ofgem.gov..1k 

3  of 4 

 I  trust that this information is helpful.  Please  contact me if you have any questions or 
would  like any  further information about any of the matters in  my response. 

Enc.  Social  Obligations Report 2012 

Open  letter 20/12/12 
Letter to  Energy UK  26/11/13 

The Office of Gas and Electricity Markets 
q  Mi. ·,,mk  e,  1dor '-WlP ·,..;E- Tel ::.20  JQOl  7000  Fax 0.20 ,gc. 7066  www.ofgem.901,. __ 

4  of 4 

 To:  non-domestic suppliers,  non-
domestic consumers,  and their 
representatives,  and other 
interested  parties 

'r  , 
)IJ  lj -. 

,.,n?,., 
l 

1 '-

, 

y 

Date:  20  December 2012 

Open  letter:  Non-domestic debt and disconnection - suppliers' approaches and 
good  practice expectations 

Summary 

This letter summarises our recent  work reviewing suppliers' approaches to managing  non-
domestic debt and disconnection  as  part of our ongoing  work in  addressing  issues faced  by 
non-domestic consumers.  We  have undertaken this work in conjunction  with Consumer 
Focus  who will  be  writing separately to individual  suppliers with their views and 
recommendations on  areas of improvement to their non-domestic debt and  disconnection 
paths. 

Non-domestic customers do  not have the same  levels of protection on  debt and 
disconnection as domestic consumers,  who are protected  th rough  licence conditions.  These 
licence conditions  provide a number of protections where households face  payment 
difficulty including  taking  into account ability to  pay,  the  use of pre-payment meters, 
preventing  the disconnection of vul nerable customers and  the provision  of i nformation 
around these obligations. 

Overall,  we do not currently see that enforceable  licence protections of this  nature are 
necessary or desirable for non-domestic customers,  where the nature of the detriment is 
different and  where equivalent issues of vulnerability and fuel  poverty do not exist. 
However,  suppliers should  treat non -domestic customers who are  in  payment difficu lties 
and  face disconnection  fairly . Through  our Retail  Market Review 1  we noted  that many small 
businesses  have similar levels of knowledge of,  and engagement in  the energy market to 
domestic customers,  and we  also  recognise the impact on  businesses  of rising energy  costs 
in  the current economic climate.  However,  the nature of the potential  detriment that can  be 
experienced  by business customers is different to  households . 

We  therefore consider suppliers should  adopt and  apply  good  practice in  their  treatm ent  of 
business custo mers  in  payment difficu lty and facing  disconnection. This lett er provides  our 
expectations of suppliers when  dealing with custome rs in these circumstances.  Our focus 
has been  on smaller non-domestic customers althoug h the good  pract ice  approaches we 
highlight should  be applied to non- domestic customers  more widely where appropriate. 

1  http· //www,ofaem.gov.uk/markets/retmkts/rmr/protecting-bus,nesses/ pages/index asox 

The Office of Gas and Electricity Markets 
9 "'lillbank London St''IJP 3GE  Tel 02& 7901  7000  Fax 02& 7901  7066 www.ofgem.gov.uk 

 
 
 In particular,  we would  expect to see  suppliers applying  good  practice in the following 
areas: 

treatment of customers  getting into payment difficulty; 

suppliers' disconnection paths which allow pro-active and tailored 
communication; 

the provision of information and signposting to third  party help; 

the use  of site visits; 

treatment of shared  occupancy of non-domestic premises by domestic 
consumers; 

the way  charges  are applied through the disconnection process;  and 

ensuring  customers with  smart meters are treated  in  the same,  fair 
manner. 

In addition, we will  review  the quarterly information we have been  receiving  from  suppliers 
on  disconnection rates,  after one year's worth  of data,  in  spring  2013, with  a view to 
publishing this data in  the future. 

We consider that it is important that all suppliers  understand  the role of the Citizens' Advice 
consumer service and  the Consumer Focus  Extra Help Unit (EHU)  which  provide advice and 
help to small  businesses in such circumstances,  and  to ensure that they are positively 
interacting  with these services.  We will continue to  monitor cases we receive from  the 
Citizens' Advice consumer service, the Consumer Focus  Extra  Help Unit,  the Ombudsman 
and  other sources to see that suppliers are applying  this good  practice  in  their approaches 
to non-domestic disconnection. 

Background and  previous activity 

Ofgem wrote an  Open  Letter2  (November 2011)  in relation to non-domestic protections 
from the 'Spring  Package',  outlining  the need for suppliers to meet requirements around 
disconnection  of meters with  smart functionality.  It also highlighted the need  for suppliers 
to apply good  practice in the way they deal with  disconnections. 

In this  letter we also stated that we would be monitoring,  on  a  quarterly basis,  the number 
of disconnections for micro- and  small  businesses,  including  where customers had  meters 
with  smart functionality  and that we  would  review the conduct of suppliers  in  this area  after 
1 year (in Spring 2013) based on the information  we receive.  To date we have  received 
data  from the last three  quarters. 

In 2011,  Consumer Focus published  a set of case studies3  from business customers who 
had  contacted  its EHU.  The  EHU  contin ues to receive  complaints from  business customers 
facing  disconnection, and is currently receiving over 50 cases a  month.  Consumer Focus 
has  also  provided  us  with  information on  supplier debt and disconnection  paths following  a 
request for information to suppliers. 

'http·//www ofgem.gov uk/Sustainabilitv/SocAction/Publications/Documentsl/nondomsmartmeterspringpackageo 
penletnov.pdf 

3  http: 1/www. consu merfocus, org .uk/files/2011/05/5mall -business-big-price. pdf 

The Office of Ga5'  and Electricity Markets 
Q  Mili'nnk Lonnon  SWiP ,,;E'  Tel 020  7QC! 1  70()(1  Fax C'20  79(11  706f  www.ofgem.gov.tJk 

2  of 6 

 Ofgem and Consumer Focus met both the large,  and a  number of smaller,  suppliers on  a 
one-to-one basis between June and September this year to discuss in more deta il t heir 
approaches to non-domestic debt and disconnection. 

As  a  result of this activity,  we have identified  a  number of areas where suppliers should 
focus t he  development of good  practice. 

Customers in payment difficulty 

All  suppliers we  met stated that disconnection  is  seen  as a  last resort and  that their debt 
paths are designed to ensure that it is  avoided where  possible.  Suppliers stated that in 
cases where a  customer is in payment difficulty and contacts them they would  seek 
solutions that would  avoid the need for disconnection. 

We  consider that suppliers should  pro-actively seek  to assist non-domestic customers in 
these circumstances.  We have noted  a  number of suppliers have set up dedicated teams or 
specific training allowing  for improved interaction  with their non-domestic customers.  We 
also  noted the development by at least one supplier of time to  pay  principles covering 
micro-businesses  where, for example,  longer payment arrangements may be offered  where 
appropriate in managing  customer debt which take account of individual business' 
circumstances (for example through  giving  consideration to a  business' cash  flow).  We 
welcome the development of approaches such as these.  The OFT  have provided  guidance 
on  debt collection4  which applies to domestic consumers but we see many of the princip les 
in it could  equally be applied  by suppliers in their treatment of non-domestic customers in 
payment difficulty. 

We  noted in a  very limited  number of cases,  certain suppliers have installed  meters w ith 
pre-payment functionality as a  means to help  business customers (at the very small end) 
to manage their payments.  While we welcome any approaches which  help customers in  this 
way,  if offered  it should  be appropriate to the customers'  needs,  is  clearly understood  by 
them, and  is at their request.  We  will continue  monitor the effectiveness of this approach. 

Suppliers' debt and disconnection  paths 

Suppliers should  ensure  that they are able to demonstrate the statutory requirements for 
notice have been  met5  but we would also expect suppliers to go  beyond these requi rements 
as good  practice . In the  information they provided,  and  when we  met with  them,  suppliers 
showed there were a  range of timescales in their overall  debt and disconnection  paths 
(based on  the  period from  the first reminder to final  disconnection ) . 

We  noted  that some suppliers segmented  their customers,  either at acquisition  or as  a 
result of payment history, and  may apply different timescales according to this 
segmentation.  While there  may be legitimate reasons for these variations,  it is  important 
that suppliers apply a  dynamic process to the way they  segment their customer base in 
terms of the treatment for debt. Suppliers should  regularly review  whether individual 
customers  have  been  appropriately categorised  and  are being treated fairly as  a  result. 

While noting  that suppliers  do have variations in  timescales,  it  is important  for  suppliers to 
demonstrate that they are actively engaging  with  the customers within the time periods set 
out in their debt paths .  We  have  noted  that suppliers send  letters to customer s at key 
stages of their debt paths and these are followed  up by  outbound  phone cal ls  and ,  in  some 

4  http://www.oft.qov.uk/shared  olt/consultat1ons/OFT664Rev  Debt  collection  ql.pdf 

5  Suppliers  are statutorily required  to give  minimum of 7  days written  notice  ahead of disconnection  or 
prepayment installat ion. That notice cannot be given  until 28 days have passed  since a  written demand for 
payment  was made. 

The Office of Gas and  Electricity Markets 
'l Mill bank  ondon 'iWlP 1-SE  Tel 020 7901  7000  Fax 020 7901  7066  www.ofgem.gov.u1 

3  of  6 

 cases,  email  and  other forms of electronic communication.  We  consider a variety of 
approaches should be  used  by suppliers to understand their customers' circumstances and 
pro-actively communicate using channels which are best suited to their customers' needs. 
We welcome the use of a range of communication·channels such as email and text 
messages,  as they can  provide effective prompts for engagement, although they should  be 
used in addition to letters and calls. 

On  this basis,  we consider those suppliers who  had shorter debt and disconnection  paths 
should  review their actions within  these paths to ensure their customer engagement 
demonstrates a  pro-active and tailored  approach to managing customers in debt. 

If used  at all,  we would  expect to see  the use of direct incentives to suppliers' staff ( or 
agents) to pursue debt only to be applied in  a way which actively encourages 
understanding the customer' situation. Any  use of such  incentives should  not encourage 
behaviours which  lead  to inappropriate outcomes. 

Provision of information and signposting to third parties 

We  noted that a number of suppliers apply approaches as part of their debt paths which 
proactively signpost to third parties who specialise in dealing  with  business debt advice (for 
example,  Business Debtline) . 

We welcome this approach,  given that the current economic climate  means that businesses 
in  energy debt,  and  facing  disconnection,  may benefit from specialist help that suppliers are 
n_ot always  in  a position  or have the ability to provide.  Some suppliers had  built strong 
working  relationships  with these third  parties and  we  would  encourage all suppliers to 
develop such  relationships,  with  a view to embedding signposting as  part of their 
disconnection  processes. 

We consider that suppliers have a  role  in  helping  customers through  provision of 
information to help manage energy costs and payments,  including the provision of energy 
efficiency information. This should  be made generally available through  websites but also 
provided  at an  appropriate time in  the debt path. 

Site visits 

Suppliers have stated that pre-disconnection site visits were an  integral  part of their 
current debt and disconnection paths.  We noted suppliers often  use third-party agents to 
undertake these visits. 

We consider site visits should  be part of the overall  set of consumer contact with customers 
within the debt and disconnection  path.  In particular,  we see  a site visit as  important where 
a customer has been  hard to reach,  as  it allows a  supplier to gain a  better understanding of 
their circumstances,  the type of premises and  potential  customer vulnerability at the site. 
As  such,  they should  take place in circumstances both  where there is  a  meter with  non-
smart, or smart,  functionality,  as face-to-face contact is  required. 

Site visits should  be  undertaken in a fair manner in accordance  with  good practice,  such  as 
providing prior notice of the visit,  making it clear to the customer the visit's purpose and 
outcomes and  not behaving in a threatening  manner. The site visit should include a clear 
'checklist' of issues and  circumstances at the site to be completed  before further action  is 
taken. These checks  should  include whether there  is shared  occupancy and signs of 
vulnerable customer occupancy. This approach  is equally important where suppliers use a 
third party agent,  and suitable controls should  be in place to ensure that the supplier is 
able to provide evidence of such  checks. 

9 

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-- :· 020  o1 7066 

• •• 

4  of 6 

 Shared occupancy of non-domestic premises with domestic consumers 

Linked  to the above,  site visits should  seek  to identify situations where  non-domestic 
premises have shared  occupancy with  domestic customers and  suppliers should  have 
processes in  place,  including  through the site visit to  do this.  When  we met with suppliers, 
they assured us that where they identified a domestic customer was resident (and sharing 
the supply) they would  stop the process and would  pursue a  path which took account of 
these circumstances.  We consider that the Energy UK  Safety Net6  provides a clear 
approach on  this and would  expect all  suppliers to adopt these principles . 

We would  also expect suppliers to have approaches which  identify sites within their non-
domestic customer base which  have domestic and/or vulnerable residents,  for example 
care homes, and to treat them  in  an appropriate manner. 

Smart functionality and remote disconnection 

When  we met suppliers,  we noted  that they  did  not apply a different debt and 
disconnection process where a  meter has smart functionality and is able to be disconnected 
remotely.  While we are  reassured  that suppliers are not adopting  different approaches,  we 
note that remote disconnection does not require a  warrant for entry,  and the potential 
additional  protection  and opportunity for customer engagement this gives.  In our ' Spring 
Package' Open  Letter, we stated how we would expect to see suppliers dealing with  smart 
functionality disconnections and will  continue to monitor to see  if further steps need to be 
taken to protect consumers.  In the meantime,  we  would  expect suppliers to be able to 
demonstrate in such  cases the steps they have taken to actively engage a customer prior to 
remote disconnection. 

Application of charges through the disconnection process 

We  noted suppliers applied  a  range of charges to the customer through  a  disconnection 
process.  It is  important that customers  have an  understanding  of the charges  and we 
expect suppliers to make these charges clear to customers at the outset of the process. 
Charges should only reflect costs  and  should  be proportionate in the way they are applied. 
Staff should  have flexibility to waive charges  where appropriate. 

Next steps 

We  expect suppliers to apply the good  practices we have identified  in  this area  and  where 
these do not already exist we  expect suppliers to take steps to develop them. 

We will  continue to monitor cases we  receive from  Consumer Focus,  the Ombudsman  and 
other sources  to see  that suppliers are applying good  practice in  their approaches to non-
domestic disconnection.  As  stated  we will  review  the information on  the numbers of 
disconnections which  we are receiving once  we  have an  annual  set of data  and  will contact 
suppliers separately on  this. 

Consumer Focus  will  be providing individual  feedback to suppliers on  their approaches to 
debt and disconnection  and  we  will  work with suppliers and Consumer Focus  on  identified 
areas for improvement.  We  will  also  review  with Consumer Focus/Regulated Industries Unit 
the actions taken  by suppliers later in  2013. 

•  http://www.energy-uk.org. uk/pol1cy/d1sconnection.html 

The Office of Gas and Electricity  Markets 
)  "11llt.er I<  London  SWtP ~GE  Tel 020 7901 7000  Fax 020  /101 70G6  www.ofgem.go.,_, 

5 of 6 

 If we see evidence that  suppliers are not acting  in  accordance with our expectations we 
may consider the case for further intervention.  If you wish  to discuss the contents of this 
letter further then please contact 

Yours sincerely 

Partner - Consumer Policy and Demand Side Insight 

The Office of Gas and Electricity Markets 
''1illbanK Lordon SWlP  Jc-_  Tel 02G  7901  7000  Fax 020  /901  70fo  www.ofgem.gov. 

6  of 6 

 
 
 Making a pos1t1ve difference 
for energy consumers 

Date:  26 November 2013 

Energy UK 
Charles House 
5-11  Regent Street 
London 
SW1Y 4LR 

Dear Dan 

Disconnection of domestic vulnerable consumers with a  non-domestic supply -
review of Energy UK Safety Net provisions 

We  recently discussed the provisions of E.UK 'Safety Net' which cover the disconnection  of 
domestic vulnerable customers from  non-domestic supply. We  discussed  actions taken  by 
suppliers in the context of our Open  Letter on  non-domestic disconnection,  20  December 
20121,  and the recent Coroners' correspondence relating  to  the  Mr Hirrell case to Ofgem 
and  Energy UK. 

I  understand in your response to the Coroner you will  be committing  to a  review of the 
relevant clauses of the commitments provided  in  the  Safety Net,  to take place over the 
coming  few  months.  Given the  Mr Hirrell  case,  and  the potential  for continued  occurrence of 
disconnection  cases where these circumstances exist,  we consider this review  is  necessary 
and  welcome your work on  it. 

Our Open  Letter provided  our view of best practice in this area,  taking into account the 
approaches suppliers told  us they  had  in place . It is  important that the Safety  Net reflects 
these approaches,  including a  process  where suppliers stop a  non-domestic disconnection 
in circumstances where a vulnerable domestic consumer is found  to be at the premises, 
and  to  pursue the appropriate actions relating  to this type of consumer.  Other actions  may, 
for example, include offering the domestic customer terms for supply.  While we note that 
the relevant clause in the  Safety Net meets the spirit of this approach,  we consider that the 
wording  should  be amended to be more explicit in  the expected treatment of these 
circumstan ces together with  a commitment by suppliers to maintain  audit trail  of the 
actions they have taken  when  dealing  with a  case  of this type. 

As  you  know Ofgem will also be monitoring  suppliers' performance in this area through the 
data  provided  by suppliers as  part of its ongoing  information  request on  non-domestic 
disconnections.  A copy  of our information request has  been sent to you. 

I  look forward  to working with  you  where necessary as you take  forward the review of th is 
part of the Safety  Net.  Following the review,  it would  be useful  for us to consider how 

1  https://www.ofgem. gov.uk/ofgem-publ1cat1ons/57748/non-dom-d,sconnection-openletter-20-12-2012.pdf 

The Office of Gas and Electricity Markets 
9  M1llbank  London SWlP 3GE  Tel 020 7901 7000  Fax 020 7901 7066  www.ofgem.gov.uk 

 
 
 
 the Safety Net provisions are promoted to non-domestic suppliers who are not signed  up to 
them currently,  or who  are  not E.UK  members. 

Yours sincerely 

Senior Manager - Consumer Policy 

T"e Office .::f G~s ar.c·  El.?ctili:-itr  tv;crk~ts 
9  r-'il\b,mk Lonrton  SWlD 3Gi'  Te'.  020 7901 7000  r-ax  020 7901  7C66  •·,ww.ofge,n.~•ov.ul< 

2  of  2

U The voice of the energy industry

H.M Coroner

Leicester City and South Leicestershire
The Town Hall

Town Hall Square

Leicester

LE1 9BG

2 May 2014

Dear Mrs Brown
RE: Michael Joseph Hirrell (CEM/AMO/00321-2013)

In my letter dated 26" November 2013 responding to your report into the death of Michael
Joseph Hirrell, | set out Energy UK's intention to review the Energy UK Safety Net to ensure
it provides appropriate protections from disconnection for vulnerable domestic consumers
who make use of a shared non-domestic supply.

As identified in your report, six of Energy UK's retail members (British Gas, EDF Energy,
E.ON, npower, ScottishPower and SSE) are signatories of the Energy UK Safety Net. The
Safety Net was established in 2004 by the Energy Retail Association (now Energy UK) as a
voluntary minimum standard to help protect vulnerable customers from disconnection. Under
the Safety Net, suppliers have agreed to never knowingly disconnect a vulnerable customer
at any time of year, where for reasons of age, health, disability or severe financial insecurity,
that customer is unable to safeguard their personal welfare or the personal welfare of other
members of the household.

Working with suppliers, Energy UK has undertaken a review of the relevant Safety Net
section regarding domestic consumers with a non-domestic supply. The matter was
discussed in detail at a meeting of Energy UK members on the 11" December 2013. It was
agreed that the Safety Net should be amended to clarify that where the supplier determines
that a member of a domestic household, which takes its energy through a non-domestic
supply, is, for reasons of age, health, disability or severe financial insecurity, unable to
safeguard their personal welfare or the personal welfare of other members of the domestic
household, the non-domestic supply will not knowingly be disconnected for reasons outside
the domestic household’s control.

Energy UK
Charles House T 020 7930 9390

5-11 Regent Street www.energy-uk.org.uk
London SW1Y 4LR t @EnergyUKcomms

Energy UK is the trading name of the Association of Electricity Producers Limited, a company limited by guarantee,
registered in England & Wales, Company Registration No 2779199, registered office as above, 1 of 2

Following further discussions with suppliers, Ofgem and Consumer Futures, final
amendments to the Safety Net were agreed by all signatories last month. The amendments
clearly set out the steps that suppliers will take as a minimum, to ensure that vulnerable
consumers whose domestic household makes use of a non-domestic supply are not
knowingly disconnected for reasons outside of their control. An updated version of the Safety
Net was subsequently published on Energy UK’s website on the 17” April:
http:/Awww.energy-uk. org. uk/publication/finish/30-disconnection/308-era-safety-net.html. A
copy of the updated Safety Net document is also enclosed with this letter.

As you are aware, suppliers are responsible for putting the principles of the Safety Net into
practice and may do this in different ways, depending on how their businesses are
structured. All signatories, however, aim to have implemented the required systems and
processes to deliver the new protections for domestic consumers with a non-domestic supply
as soon as practicable and will have done so by the end of 2014. Energy UK is also
committed to keeping the operation of the Safety Net, including the new provisions, under
constant review. This includes audits of suppliers’ systems and processes by an independent
auditor.

| hope you would agree that by adopting the steps and protections now clearly set out in the
Safety Net, industry minimises the risk that any vulnerable domestic consumer who make
use of a shared supply, and who may, therefore, not have a formal legal relationship with the
energy supplier, as was the case with Mr Hirrell, are disconnected for reasons outside of
their control.

Mindful that you are extremely busy, if you have any questions or require additional
information please contact me directly on 020 7747 2930 or at angela.knight@eneray-
uk.org.uk.

Yours sincerely

Angela Knight CBE
Chief Executive

G.c,
Marcus Clements, Head of Consumer Affairs, Ofgem, 9 Millbank, London, SW1P 3GE

Guy Johnson, Director of External Affairs, RWE npower, Windmill Hill Business Park,
Whitehall Way, Swindon, Wiltshire, SN5 6PB

Energy UK is the trading name of the Association of Electricity Producers Limited, a company limited by guarantee,
registered in England & Wales, Company Registration No 2779199, registered office as above. 2of2