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Energy theft: it's time to take action

From the Knowledge Centre

Published March 6th 2018 in Debt Recovery & Revenue Management by Lloyd Birkhead

Lloyd Birkhead, MD of Echo's Grosvenor Services Group, takes a closer look at energy theft, a serious concern for the sector, and what can be done to improve investigation and detection efforts in this month's coffee break blog...

Energy theft (also known as meter cheating), is a serious issue, more than £400 million worth of electricity and gas are estimated to be stolen each year through meter tampering. This doesn't just affect energy companies, it’s also having a detrimental effect on cash-strapped consumers; offences can add £20 to each household bill.

What’s more, meter tampering poses a dangerous threat to public safety, leaving unsafe equipment which can cause electric shocks, fires, and even explosions.

Energy companies have a commitment to Ofgem to do what they can to alleviate the issue - careful and proactive investigation and detection is therefore crucial. To ensure success, the right levels of focus, expertise and resources must be devoted to the problem that's where highly trained field teams come in.

Trained field teams are critical
While some forms of energy theft are obvious (damage to the meter or missing dials), other instances can be incredibly clandestine and likely to go unnoticed without a well-trained eye. For field teams, an understanding of meters, although essential, is simply not enough on its own. Specialist investigation personnel must be trained to spot every occurrence of energy theft, no matter how subtle.

"A strong awareness of surroundings and an inquisitive nature are essential skills to spot clues and helpful indicators."

Many providers have in-house field teams, however, sector pressures such as the smart meter rollout are taking up field resource, inhibiting ability to deal with energy theft.

Field teams must act quickly and decisively to a suspected case – and where there is a serious safety concern, a same day visit is essential. Field teams must therefore cover the entirety of the UK, rather than “hotspots” where theft is prevalent.

Energy providers who have time and resource constraints that hinder theft detection should consider outsourcing the task to a specialist team, who can manage the whole process from end to end.

A customer-centric approach
strong customer service is as important as effective investigation skills. Field teams must be capable of dealing with challenging and difficult circumstances effectively, while remaining sensitive to the individual needs of the customer.

"It’s important that guilt is not assumed from the outset, and that a sensitive approach is taken at all times."

Where theft has been identified and the site made safe, outstanding arrears must be discussed with the customer, necessitating additional expertise in effective debt recovery. And, where the property in question can't be accessed, obtaining and executing a warrant may be required. The benefits of a multi-skilled field team can therefore not be underestimated.

Not every investigation confirms illegal activity; these situations are incredibly delicate and have the potential to quickly escalate, creating irreparable damage to customer relationships and brand reputation. Visits must therefore be handled with great care and empathy.

Within lies an opportunity to connect with vulnerable customers who, while not having done anything illegal, may be living with difficult circumstances, which may otherwise have gone unnoticed by their energy providers. Another reason why proactive customer engagement is so important.

It's time to act, now
Proactively preventing energy theft needs to be treated as a priority moving forwards. Initiatives such as the Theft Risk Assessment Service and the Energy Theft & Tip Off Service are a great start. However, we need to be doing more at a local level if we are to better combat this dangerous issue.

Field investigation teams need to forge strong relationships with key groups such as local authorities, relevant charities, meter reading providers and debt collection agencies. This both raises awareness of energy theft and enables wider detection of offences.

"Greater energy theft investigation and detection is not just a financial obligation – it’s a serious moral issue too. While financial implications should not be ignored, safeguarding the health and well-being of customers and the wider community is a fundamental responsibility that can't be disregarded."

As a sector, it’s high time that we placed tackling energy theft higher in our priority list, and that needs to start now.


Suggested Further Reading

Knowledge Centre: Research

Energy Services Catalogue

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