Updated, 23.17

ELECTRICITY COMPANIES will be alerted if customers switching accounts from other providers have outstanding arrears, under new rules being drawn up by the Commission for Energy Regulation (CER).

The new rules are intended to stop consumers from switching between different service providers in attempts to evade outstanding bills – and, it is hoped, will encourage customers to confront their arrears instead of drowning in debt.

The proposals are based on a similar scheme already in place in the UK, where ‘debt blocking’ kicks in above a certain level – meaning that while customers with a certain amount of arrears can move between providers, those with significant levels of unpaid bills cannot escape their obligations.

Announcing its proposals, the CER said it was concerned that in “the current difficult economic climate, customer and industry debt levels are being exacerbated by some customers’ changing supplier in order to avoid paying their arrears or to avoid a pending disconnection.

“Debt hopping, and indeed the high general level of debt, is acknowledged as a serious issue for the industry raising costs for suppliers and ultimately for all consumers.”

The proposals were welcomed by Bord Gáis, which said they were a “fair solution” that would stop customers seeing their debts spiral out of control.

A company spokesman said Bord Gáis was disappointed, however, that there was no ‘comprehensive solution’ allowing suppliers to take more active steps in helping customers to avoid falling into debt.

“The issue of customer debt is a growing problem and Bord Gáis is committed to working with customers who are in difficulties by offering pay-a-you-go plans and meters,” he said.