We surveyed energy customers to find out which providers have the most satisfied customers. Our findings show vulnerable electricity consumers are getting the worst deal.
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As the mercury drops this winter and power bills head north, thousands of consumers are likely to have their electricity disconnected. Last year alone, 25,300 households were cut off from the grid because of unpaid electricity bills.
Chances are many will end up as customers of prepay power retailer Globug, the last-resort provider for cash-strapped consumers no one else wants on their books. Not only do these consumers have little choice about where they get their power, they’re also more likely to get bad service.
In our latest satisfaction survey, 42% of Globug customers had been on the receiving end of poor customer service – the worst result of any power company in our past 3 surveys.
Globug’s performance stands out from the trend this year, which showed a small rise in customer satisfaction. Overall, 51% of consumers were very satisfied with their power company’s service, up from 45% in 2017.
But while the industry has lifted its game, rising power prices continue to see significant numbers of households, such as those with Globug, struggling to keep the lights on.
Across all consumers, 15% had cut back on heating because of the cost of power. In the past year, 18% had run into financial difficulties paying their bill. Fourteen percent had overdue fees added to their account because they couldn’t pay on time.
Globug customers were significantly more likely to be struggling. More than a third (38%) had cut back on heating because of the cost.
Just over half had experienced financial difficulty paying for power in the past year with 1 in 2 borrowing from friends or family to meet costs. Sixty-four percent had a household income of less than $50,000.
The difficulty of keeping their homes warm was compounded by the fact many lived in uninsulated houses that lacked efficient heating. Fifty percent said their home was difficult to heat during winter.
Power prices are finally getting attention as a result of a review commenced by Energy and Resources Minister Megan Woods.
Announcing the review in March, Minister Woods acknowledged the increase in power prices had outstripped inflation. “Residential electricity prices have risen by around 50% since 2000 but the price for business has remained flat. We want to find out why that is,” she said.
By international standards, it’s recognised the prices we pay are high. According to research by the International Energy Agency (IEA), residential prices in 2014 were “well above” the average of IEA countries surveyed.
Among the issues the review will consider is whether power prices are efficient, fair and equitable, and whether all consumers have access to affordable electricity.
Our research shows there are major issues for vulnerable consumers getting access to affordable power and decent service. Safeguards are also lacking to ensure consumers on prepay power plans are treated fairly and don’t face disproportionate costs.
We’ll be providing the pricing review with the results of our research.*
|Energy provider||Satisfaction rating[bar; width=medium]||Customers[width=medium]||Market share[width=auto]|
Flick retained its place at the top of the satisfaction table this year. Flick’s main selling point is that its tariffs are tied to the wholesale market, offering consumers savings when plenty of power is being generated and spot prices are low. Most customers (57%) think they’re getting very good value for money, though that’s down from 63% last year.
Powershop rated above average for customer satisfaction. Just 7% of its customers said they’d experienced poor service from the company in the past 12 months. Powershop’s overall score has risen to 66% from 61% last year.
Electric Kiwi is a recent arrival and 87% of its customers have been with it for 2 years or less. The company, which offers customers a free hour of power a day, scored above average for overall satisfaction and value for money (64%).
Pulse scored above average for customer support (57%) and value for money (57%). Like Electric Kiwi, it had a high proportion (60%) of customers who’d been with it for 2 years or less. Most who’d switched to the company in the past year had done so after being contacted by a sales rep.
Nova’s satisfaction rating has dropped from 72% in our 2016 survey to 57% this year. The company has shed about 2600 residential customers in the past 12 months. However, existing customers were the least likely to be considering switching: 69% said it was unlikely they’d do so.
After Flick and Powershop, Energy Online had the fewest complaints about poor service. Customers were also less likely to be kept waiting to speak to a service rep. However, its overall satisfaction score dropped from 66% in 2016 to 54% this year.
Meridian’s advertising plays up its power generation from renewable resources and it had the highest proportion of customers satisfied with their retailer’s green credentials. Customers were also more likely to be concerned about the environmental impacts of their power use.
Genesis is the biggest player. In the past year, it’s lost about 12,500 customers, but still supplies 20% of the residential market (rising to 25% when subsidiary Energy Online is included). While the company’s improved its overall score this year, customers once again rated it below average for value for money.
Number 3 for market share, Mercury gained about 2500 customers in the past year. However, it had a higher-than-average proportion of customers who were thinking about switching: 30% thought it was likely they’d change retailer in the next 12 months.
Trustpower’s overall satisfaction score matched Genesis and Mercury. However, its customers were more likely to be dissatisfied with value for money: 1 in 5 didn’t think they were getting good value. Its residential connections are down about 2000 from April 2017. Last year, the company featured on the Commerce Commission’s list of traders that generate the most Fair Trading Act complaints.
Contact’s satisfaction rating of 45% was below the industry average. In previous surveys, it’s been slated for the poor performance of its call centre. Ratings for this measure improved slightly but 40% of customers still had long waits to speak to a sales rep. Contact’s residential connections have dropped by 6400 since April 2017. It also featured on the Commerce Commission’s list of traders that caused the most Fair Trading Act complaints.
Prepay power retailer Globug was the only company to perform below average on all our key satisfaction measures. One out of 4 Globug customers said they’d complained to the company about its service, which was the worst result of any retailer. Globug’s ratings are a major concern given it deals with some of the most vulnerable consumers. Just over half had experienced financial difficulty paying their power bills in the past year.
Bosco, a Mercury subsidiary that supplies power to apartments in Auckland and Wellington, also returned poor results. Nearly 1 in 3 customers reported problems with incorrect bills while half said they’d put up with lengthy waits to speak to a service rep. A high proportion of Bosco customers said they’d experienced financial difficulties paying their power bills.
|Home heating costs||Survey responses[bar]|
|I can heat my home comfortably for a reasonable price||47%|
|I can heat my home comfortably but feel I have to pay too much||38%|
|My home's not as warm as I'd like – the cost of energy means I've cut back on heating||15%|
|How concerned are you about your household power costs?||Survey responses[bar]|
GUIDE TO THE TABLE OUR DATA are from a nationally representative survey of 1525 New Zealanders, aged 18 and over, carried out in May 2018. Satisfaction ratings show the proportion of respondents who scored their retailer 8, 9 or 10 on a scale from 0 (very dissatisfied) to 10 (very satisfied). Results are for retailers with a minimum of 30 responses. Customers and Market share data are as at April 2018 and are for residential connections, and sourced from the Electricity Authority. Data may add to +/- 100% due to rounding.
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