Payments and defaults

Disconnections are used as a last resort for electricity and gas providers if you don’t pay your bills and owe $300 or more. If a provider intends to disconnect you, they will send you a payment reminder notice and a disconnection warning first. If your provider sends you reminder notices or disconnection warnings for not paying 2 bills in a row, they might decide to put you on a ‘shortened collection cycle’.

This means you may not get reminder notices in future about any unpaid bills and just get a disconnection notice without a reminder.

If you don’t pay that bill by the date on the disconnection notice, the provider might disconnect you. They must tell you if they’re going to put you on a shortened collection cycle. You can return to a regular collection cycle by paying 3 bills in a row by the due date.

If you don’t pay your water bills, water providers can’t disconnect you but they can severely restrict your water flow.

If you don’t contact your energy or water provider until after you’ve been disconnected or restricted, you might have to pay a fee, a security deposit and some or all of the amount owing before they’ll reconnect you.

Read more advice about disconnections. 

A default listing is recorded on your credit report and impacts your ability to obtain credit for financial, telecommunications and energy services in the future. You can receive a default listing if you’re 60 days or more overdue on making payment on your energy or water accounts and the amount overdue is $150 or more.

Before a default is listed on your credit file, your provider must issue you with two written notices to your last known physical or email address. The first is an overdue notice which informs you of the debt outstanding and that date payment is due. The second is the notice of intent to default which must be issued at least 30 days after the overdue notice.

Your provider must wait at least 14 days after the date of issue of the second notice before listing the default. This period allows you one final opportunity to pay the overdue balance.

Your provider must then disclose the default details to a credit reporting body (CRB) within three months of the notice of intent to default. If you pay the debt in full, or if the overdue amount falls below $150 due to any payments you may have made prior to the default being disclosed to a CRB, your provider is prohibited from listing the default.

A default will remain on your credit file for a minimum of five years from the date that it was listed. It remains listed even if you make a part or full payment to settle the debt at a later date – the status will be updated to reflect that it has been paid. Information contained within your credit report will also advise of the removal date.

To access your credit report, you must contact a CRB:

• Equifax
• Illion
• Experian. 

Contact your provider to ask about payment plans. Providers are required to offer payment plans to customers who need time to pay their bill. Payment plans are made up of agreed instalment amounts.

If you’re experiencing financial difficulty, contact your provider and let them know. All providers need to have a policy to help customers in financial difficulty. Most providers have special hardship programs that help customers stay connected and stay on top of their bills.

Each provider has its own eligibility criteria for their programs so you will need to check with them to see if you’re eligible. 

You may be eligible for rebates and concessions to reduce your bill each month. If you’re experiencing a short-term financial crisis you might be eligible for the Home Energy Emergency Assistance Scheme payment.

Read more advice about rebates and concessions. 

Most providers offer customers different ways to pay their bill (e.g. BPAY, direct debit, Centrepay, credit card, in person at the post office). However, they might charge you a fee for paying a certain way. Check with your provider.

If you choose to offer payment in a way not mentioned on your bill, your provider may decline to accept your method of payment. If this occurs you will need to make payment in a way acceptable to your provider. 

All energy and some water providers offer Centrepay to Centrelink customers. Centrelink deducts an amount from your pension or benefit each fortnight (at least $10) and transfers it to your energy or water account. You still receive a bill, but only for any amount you still owe at the end of the quarter. Contact Centrelink or your provider to find out more.

A financial counsellor can help you manage a short-term financial crisis and stay in control of your finances. They’re a free service that can help by:

• budgeting and organising your finances
• figuring out if you’re eligible for government assistance
• explaining debt recovery, bankruptcy and other options
• putting you in touch with other services, such as legal aid and personal counselling.

Get more information:

• List of financial counsellors
• National Debt Helpline