Electricity bills are often a source of confusion, with many people not understanding what the different charges mean. Arrears are one of the most common charges on electricity bills, but many people don’t know what they are. In this article, we will look at the definition of arrears, and how they relate to electricity bills.
Definition of Arrears
Arrears are a type of debt that is due from a person or company to another, but has yet to be paid. It is usually associated with bills, such as electricity bills, that have not been paid on time. The term ‘arrears’ is derived from the Latin word ‘arriere’, which means ‘behind’.
In the context of an electricity bill, arrears refer to any unpaid charges for electricity that have been incurred over a period of time. This could be from a single bill, or from multiple bills that have not been paid.
Understanding Electricity Bill Arrears
When a person or company receives an electricity bill, they are expected to pay the full amount within the specified period. If this is not done, then the unpaid amount will be carried over to the next bill, and will be referred to as ‘arrears’. This means that the person or company will have to pay the amount owed, plus the arrears, in order to settle their electricity bill.
Arrears can also be incurred if a person or company has received a refund for an electricity bill, but has not paid the full amount. In this case, the amount of the refund will be added to the arrears.
Arrears can also be incurred if a person or company has received a discount for an electricity bill, but has not paid the full amount. In this case, the amount of the discount will be added to the arrears.
In summary, arrears are any unpaid charges for electricity that have been incurred over a period of time. This could be from a single bill, or from multiple bills that have not been paid. It is important to pay all electricity bills on time in order to avoid arrears. If arrears are incurred, they must be paid in order to settle the electricity bill.