The gas supplier set an “astronomical” amount due to damage to the meter! Is it legal?

13.03.2020 Irina Stromberga, lawyer

Many inhabitants and enterprises of Latvia faced an unpleasant situation. A year, or even a year and a half ago, they changed gas meters at their facility, and today they suddenly received a complaint from the gas supplier stating that the meter had been handed over for examination, and during the examination, damage to the seal (for example, scratches) was detected, which, according to the expert, indicates an attempt to interfere with the operation of the meter.

Then, based on this examination and guided by the Regulation No. 78 of the Cabinet of Ministers “Regulations Regarding the Trade and Use of Natural Gas”, the service provider requires the consumer to pay a very significant amount, which is determined and indicated in the claim as “recalculation of gas consumption”.

In accordance with clause 89 of this regulation, the recalculation amount is calculated as follows. The basis is the maximum throughput of the gas meter (cubic meters per hour), which are multiplied by 24 hours, then by the number of days in the billing period. Then from the resulting amount deduct the amount that the consumer has already paid for gas during this billing period. The resulting difference is multiplied by the tariff that was in effect that month when the consumer’s meter was taken off, and then the amount is also multiplied by two. The result is an “astronomical” amount, which the gas supplier presents to the user for payment.

Such a calculation, as a rule, is made correctly, but it is not possible to agree with all the reasons specified in the request of the gas supplier.

Clause 87 of the above regulation, which the gas supplier refers to when making a claim, is as follows: “If during the inspection of the natural gas system of the system user the distribution system operator establishes an arbitrary installation of connection before a commercial meter, use of natural gas by the system user without a commercial meter, a damaged commercial meter or seal, and as a result of any of the said activities the amount of natural gas consumption reading has been reduced or a possibility has been created to use natural gas free of charge, the system operator shall draw up a statement on the established fact in two copies. One copy of the statement shall be kept by the distribution system operator, while the other shall be given to the system user or the representative thereof”. Based on such a statement, a requirement is formed for the user indicating sufficiently significant amounts.

Thus, in the opinion of the gas supplier, it is enough to fix the fact of any damage to the meter or seal, making an appropriate examination, which may indicate an attempt to intervene in the meter’s operation in order to use the gas for free, and this is already a reason for the supplier to expose a claim to the consumer with the requirement to pay recalculation of gas consumption for the period, which is calculated as a year before the meter is removed.

The gas supplier’s examination does not ask how long the seal was damaged, whether these damage indicate a real interference with the meter, and what volumes of gas were lost (and not just a possible attempt or unintentional damage). At the same time, the fact that over the entire period of operation of this meter the gas consumption was uniform was ignored; the volume of consumption did not decrease. That is, the supplier is not at all interested in whether there was a theft of gas, or whether the nature of the damage to the meter/seal indicates the created opportunity to consume gas for free. Is there any damage on the seal or on the meter? Pay!

Clause 87 of the Regulation No. 78 of the Cabinet of Ministers is used only to calculate the amount of the claim and set it for payment to the gas consumer. To establish fault, it is not enough just to fix the fact of damage to the seal/meter and make a recalculation. In this situation, it would be logical and correct:

a) record the negative consequences of damage to the meter or seal (decrease in meter readings, the fact of creating the ability to use gas for free or theft of gas);

b) determine the causal relation between the fact of damage to the seal and the above negative consequences.

Just using the regulation of the Cabinet of Ministers should not be enough to establish guilt and justify the requirements of the gas supplier to pay the accrued recalculation.

Nevertheless, the supplier successfully applies this practice. Indeed, the very same Regulation No. 78 of the Cabinet of Ministers for a gas supplier, as an operator of a gas distribution system, defines the right to immediately stop the gas supply if a violation has been discovered that has caused the consumer to decrease the amount of gas recorded or to create the opportunity to consume gas for free. Therefore, in case of disagreement with the supplier’s requirement, there is a risk of interruption in gas supplies, which could significantly harm the activities of the enterprise or the functioning of a private facility.

Thus, in this situation, the consumer is faced with a choice: either defend his innocence in court, while risking to remain without gas for the duration of the trial, or to conclude the amicable agreement with the gas supplier, paying them a part of the calculated recalculation amount.

However, it is possible to fight this, since the last word always remains with the judge, and it would be unfair to blame anyone for a violation that this person did not commit. Pre-trial proceedings are also a good opportunity to prove that you are not involved in an offense and resolve a dispute with a gas supplier on mutually beneficial conditions. The requirement presented by the supplier is only the opinion of one of the parties with which it is possible to disagree and defend one’s position to the end.

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