Genesis to refund $1.1m to business customers after billing errors
Monday, 10 May 2021
Genesis Energy is set to refund $1.1 million to business customers after six years of billing errors.
Genesis also said it would not seek to recover $2.4m from 1356 customers who underpaid during that period.
The Commerce Commission has issued a warning to Genesis, after the company alerted it to the billing errors.
In all likelihood, Genesis breached the Fair Trading Act between February 2014 and July 2020, commission chairwoman Anna Rawlings said.
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During that period, Genesis issued invoices that displayed inaccurate multipliers applied in respect of some electricity fixture charges.
To ensure availability and supply of power across the network, Genesis applies “fixture charges” that lines companies charge electricity retailers, who in turn pass on the charges to customers.
These fixture charges vary between power companies but can include capacity charges to ensure electricity is available when needed, congestion charges, to ensure electricity can be supplied when the network is under heavy demand, distance charges, to recover the costs associated with high voltage lines and cables and sub-transmission lines and cables.
Differing multipliers are applied to the charges and include energy usage, distance of connection, and level of network congestion.
The multipliers are specific to each customer and changes to them are manually applied to each customer by Genesis.
Genesis told the commission that between 2014 and 2020, it had applied incorrect multipliers when calculating fixture charges owed by the effected business customers.
As a result, Genesis misrepresented the total price to be paid for the electricity services provided to affected business customers.
Rawlings said it was the responsibility of the company to ensure it charged customers correctly.
“In many cases customers will not be in position to easily identify whether an error has been made when they are invoiced for goods and services, and they are entitled to assume that they are being asked to pay what is due to be paid,” she said.
“Businesses must make sure that they have systems in place to ensure that customers are charged accurately, and to identify and correct inaccuracies promptly if they arise.”
Genesis reported itself to the commission and has implemented and audit system to ensure it does not happen again, she said.
The warning letter, which has been published on the commission’s website, explains that the commission’s view that a business is behaving in a way that could be considered a breach of the law however, only the courts can decide whether an actual breach has occurred.