Faulty meters cost AGL $160,000 in penalties from regulator

AGL and its subsidiaries have paid penalties totalling $160,000 after the regulator issued it with eight infringement notices for breaching National Electricity Rules.

The Australian Energy Regulator (AER) alleged that AGL failed to promptly fix customers’ faulty meters, with some cases taking more than 500 days to rectify after being notified.

This resulted in AGL customers receiving estimated energy bills as faulty meters inaccurately recorded their power usage.

AER Chair Clare Savage said more must be done to avoid the risk of overcharging customers and to ensure bills reflect actual consumption whenever feasible.

“If a meter is faulty, then retailers must ensure they are doing everything possible to ensure it is fixed promptly,” she said.

“It is simply not good enough for customers to receive estimated bills because retailers do not have adequate systems and processes in place to ensure faulty meters were fixed as soon as possible.”

The retail energy giant responded by stating it deeply regrets these incidents and is committed to delivering better outcomes for customers in the future.

“AGL apologises to customers affected by this issue and is now focused on providing them with a positive experience. AGL amended meter readings or provided bill credits where appropriate and have since improved meter installation processes to ensure these issues are not repeated,” an AGL spokeswoman said.

According to the AER, there were reasonable grounds to allege AGL failed to ‘promptly appoint metering coordinators after receiving notice that customers’ meters were faulty’.

This comes after new rules were introduced in 2017 that make electricity providers responsible for metering services, including replacing faulty meters with smart meters – new technology that allows customers to tap into their usage habits.

Subsidiaries of AGL that paid penalties included AGL Sales, AGL South Australia and Powerdirect.

Wait, what is an estimated energy bill?

Estimated energy bills are what retailers fall back on if a meter reader is unable to carry out a meter reading. Residences with an analogue electricity or gas meter will require a manual reading, which is undertaken by a contractor on behalf of a retailer who physically visits a property. You may also receive estimated bills if you sign up for monthly billing from your retailer, with your account settled by a quarterly meter reading.

Customers should always be notified in writing by their retailer if their energy usage has been estimated, said Canstar Blue Editor-in-Chief, Simon Downes.

“Aussies living in older homes will usually have their meters read every quarter, but if the contractor’s access to the meter is blocked, then an estimated reading will follow, which is largely based off historical usage and the average consumption for that area,” he said.

“There are many reasons why estimated readings take place, such as a locked gate or an unsecured dog on the premises. There have even been cases of snakes and spiders blocking access to meters, resulting in estimated power bills.”

Estimated readings are also a feature of bill smoothing – a method offered by most retailers that can allow customers to make regular payments to help alleviate bill shock. It works by retailers using previous billing data or estimating costs based on a similar household’s usage in the same area.

Smart Meters Explained

Unlike traditional meters, a smart meter records electricity usage (per kWh) every 30 minutes or so, which is forwarded to energy providers for billing purposes. Smart meters do not require a person to physically attend to a property to take a meter reading, meaning customers should never be issued with an estimated bill.

Faulty meters are now generally replaced with smart meters under new rules that are designed to give consumers access to the latest energy technology.

“Smart meters benefit competition by providing retailers with increased opportunities to develop innovative energy services such as time of use pricing, and also offer consumers more ways to manage and control their energy consumption,” AER’s Clare Savage said.

“The longer customers have to wait for their smart meters because of delays by retailers, the longer customers are denied the benefits of this technology.”

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