1. Debt Flagging for Electricity & Gas Customers – Industry Code CER, GMARG/IGG August, 2011

2. Background & Decision Customer Bad Debt in Elec & Gas Markets CER Consultation – March 2011 –Options Debt Flagging & Blocking Decision Issued – June 2011 –Debt Flagging Domestics & Small/Medium Business Excludes; –Electricity – LEUs: DG 7-10 & TCon –Gas – DM & LDM

3. Decision Implement a debt ‘flag’ –Monetary & Timing Thresholds –No Contract Default or Debt Assignment Industry Code on Debt Flagging –Define Finer Customer Details –Reporting/Monitoring –Review after 1 year Implementation –1 st October 2011 –Integrated Solution: 1 st January 2013

4. Industry Code Discussion on Main Aspects –Gas Industry → GMARG, 3 rd August –Electricity Industry → IGG, 10 th August Feedback Received Input into Draft Code Code Consultation Code Approval

5. Industry Code - Principle Areas 1.Applicability 2.Processes 3.Grounds to Raise a Flag Thresholds/Issues e.g. Change of Tenancy 4.Customer Communications Notice to Customer of Industry Process Notice to Customer where flag raised 5.Timings 6.Reporting

6. 1. Applicability All Suppliers of Electricity & Gas; –Domestics & Small/Medium Businesses –Excludes; Electricity – LEUs: DG 7-10 & TCon Gas – DM & LDM Relates to process operational from 1 st October 2011

7. 2. Process Implementation Gas –BGN Proposal –G208RQ Change of Shipper Cancellation Request open to Outgoing Supplier Electricity –RMDS Proposal: Working Process 0020 Debt Flagging –Mostly Manual Process given Harmonisation Project – MPRN Lists between Outgoing/Incoming Supplier & MRSO

8. 3. Grounds to Raise a Flag (I) As per decision; From when amount fell due, not bill issued, this typically 14 days from bill issued. Customer Category Debt Value & Duration Threshold Domestic> €250 for > 42days from due Small BusinessElec (LV-NonMD/DG5) Gas (NDM <73MWh) > €750 for > 42 days from due Medium BusinessElec (LVMD/DG6) Gas (NDM >73MWh) > €TBA (€1,500?) for > 42 days from due

9. Outstanding Deposits Excluded Cannot Raise a Flag where customer pursuing complaint re monies owed Must adhere to Industry Thresholds & Timings Raising Flag is Not Optional Duel Fuel: Cannot flag for Electricity CoS where debt criteria met on Gas account & vice versa 3. Grounds to Raise a Flag (II)

10. Change of Legal Entity –Cannot flag new tenant CoS where debt accumulated by previous tenant –Elec: CoLE signalled on 110 message, old supplier cannot raise flag –Gas: Not signalled → Options: Before Flag: Old Supplier contact customer to confirm still in resident when receive G204N After Flag: New Supplier contact customer to confirm that customer is not new resident When informing of CoS Cancellation? 3. Grounds to Raise a Flag (III)

11. 4. Customer Communication (I) Communication Re Flagging Process –Data Protection Considerations –Customer must be aware of industry flagging process at point of sign up –Options: Suppliers include relevant provisions in t&c Customer explicitly indicate agreement that account may be flagged when signing contract

12. 4. Customer Communication (II) Communication Re CoS Cancellation Customer must be advised where CoS is cancelled on the basis of a debt flag. Options –New Supplier contacts customer –Losing Supplier contacts customer –Both New and Old Supplier contacts customer

13. 5. Timings Number of business days required: –Outgoing Supplier to raise a flag –Incoming Supplier to proceed or cancel CoS –Customer to be contacted where CoS Cancelled 2-3 business days? Align with cooling off period?

14. 6. Reporting CER monitoring debt flagging process On monthly basis, receive from DSOs –# CoS requests flagged by losing supplier –# CoS cancellations following flag CER will spot check M/GPRNs which were flagged with suppliers from time to time Review after 1 year

15. Next Steps Input any GMARG/IGG feedback into draft code Responses – 17 th August 2011 To: efarrelly@cer.ie