4 March 2022

Scrapping low use power plans will see many paying more for electricity

Low power users to be hit hardest by changes.

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Paul S.
10 Jun 2022
No daily charge

A new power retailer from the UK has arrived on these shores and their low user plan doesn't charge a daily rate.
We're on solar, I put the Octopus rates into our solar management software and based on our power usage and solar export since the system was installed last September, we'd save $250/yr switching from Meridian.
https://octopusenergy.nz/

Michele T.
21 May 2022
Maximum low fix charge

Am I right in understanding this article to say that the previous maximum daily charge was 30c/day and the new maximum low fix charge will be 60c/day because Mercury have doubled mine from 33 cents to 66 cents - is this even legal?

Deborah M.
11 May 2022
Ridiculous

My family and I are affected by this price hike, both our electricity and gas has been put up. We are with Nova. I cannot understand this Government. The cost of living is so expensive in NZ and they decide to do this. My bill for the month of April would have been $200 under the low user scheme, but is $250 under the new pricing. My family is able to absorb this increase in price, but I feel for those who are on smaller incomes. Come on NZ Government, look after your vulnerable! Also, I'm not sure I agree with the comment in the article about households using less power than 20 years ago. Would like to know a bit more data about how this conclusion was reached.

Helen B.
30 Apr 2022
More Poverty

I can barely afford power now. By the end of the increases every cent will be spent on line charges with little left for power. This is a vote changer for me.

Ian H
02 Apr 2022
Scrap the electricity fixed charges

A much fairer charging regime, which also rewards low use and penalises high use would be to :-
• Scrap the fixed charge and charge only for the KWh electricity used.
• Increase the charges for KWh to recover the total of what was being charged for via the fixed charges.
• Introduce a minimum monthly invoice, set to a rate that will not increase the total monthly invoices for an average low user, I guess something like $90 to $120 per month.
The monthly minimum will mean holiday homes etc will pay for having access year round while may infrequently use much electricity.
Of course, the rate per KWh will increase to recover the fixed rate fees, but this will be a better incentive to reduce electricity use, and the large users will pay more while the most in need low users will not be penalised. An average user should be about the same as now. It should also make the cost of Solar panels for viable.

Gaye Oldham
02 Apr 2022
Not Happy

Like most people I am not happy with the power increases at all. I am a low user and of the senior variety. Last winter I did not use my heater at all because of the cost, it was hot water bottles and bed earlier than usual. My point is really, so we get an increase in our super payments, we get winter payment allowance and that all seems to go on greatly increased prices for just general living, not fun for sure.
Oh and I check PowerSwitch regularly so will be logging in when updated to see if I can get less expensive power, currently with Mercury.

Dwayne B.
18 Mar 2022
Punishing those with good habits.

This is outrageous.

So, people who have bad habits and who waste energy are to be rewarded by having their usage subsidised by those of us who are more responsible.

Disgusting.

We all know who these people are, and once again the government will force us to subsisidse the dregs and loafers.

Paul S.
08 Mar 2022
Missing GST

My biggest pet hate about power retailers is their blatant attempt to hide the real price of their plans by omitting GST, and Consumer, you've done this in the article. The daily charge that we pay isn't 30c, it's 34.5c ($126/yr), and the top rate by 2026 isn't $1.80, it's $2.07 ($756/yr), so an increase of $629. Over the next 4 years we will be paying an extra $2,119 on our power bill, just from the increase in line charges, and that doesn't take into account the increase in unit cost. That is going to push out offsetting our solar upfront cost by 2-3 years. It's also going to impact the savings we'd planned when buying an EV, and when RUC is introduced in 2024 and adds another $2000/yr to the running costs, going green doesn't appear to be so appealing any more.

Roger W.
02 Apr 2022
GST on Domestic Electricity Supply

GST is a retail tax. All domestic power charges should be gst inclusive - those who legitimately claim the gst content as an input can work out the exclusive price themselves; they are a minority.

MRC T.
07 Mar 2022
Power must also be available.

We're a low user and I am concerned about the fixed rate increase as it will affect us at a time when inflation is rising particularly the price of fuel. We live rurally and have no public transport to provide an alternative.
My concern with the reliance on power is the possibility of power cuts as happened last year on the coldest night when demand was higher than supply.

Linda C.
06 Mar 2022
Super low user says what?

I am one of the low usage group, & take active measures to keep costs low so fixed income can go on other things - I liked that fixed charges were low so I could do that. However, I do understand that reliable infrastructure needs to be paid for and that benefits low users. I still would have installed the ultra low emission log burner a couple of years ago, but the cost recovery calculation is now way longer for that. As it has a cooktop it still will help keep power use lower in winter while providing all heating - still better than the cheaper heatpump, and will operate during power outages, so "cost recovery" is not the only metric. Possibly the winter heating payment for beneficiaries might take this increase into account - fingers crossed!

KEVIN F.
06 Mar 2022
Power Daily fixed charges low user

The daily charge by Mercury is 33.33 cents per day .Advised me the charge is going up to 66.66cents per day .
Like to know where Consumer is getting the info that 30cents is the maximum charge .
Comment please consumer .
Thank you Kevin Fox

Will C.
06 Mar 2022
GST

Hi Kevin. It's 30 cents plus GST.

bern s.
05 Mar 2022
retailers have the rates that you are charged.

retailers have the control of the rates charged the distribution companies set the cost of electricity distribution, daily supply rate, variable usage rate, your retailer can adjust their rates accordingly , I am on a low user plan and I logged into my retailers web site, applying GST my april electricity bill will increase by 5%, Changes should be made to the variable usage rate.The consumer report is a good break down of the Low User rate.
Bern Sommerfeld Energy Chair (off board) GREY POWER NZ Federation inc

Ken M.
05 Mar 2022
The lines cost a lot

This is a good move for NZ. About 1/3 of elctricity costs are for the lines and current pricing doesn't reflect that. Low users, especially those with solar power, use little energy (kWh) so don't pay for the cost of having lines that enable them to use power in winter. It's really important that the price signals are correct in a market. We don't give cheap butter to people of low income and we should give away cheap power. There need to be other mechanism to support those who can't afford it.

Steve
05 Mar 2022
Shocking

I’m a single person, out of work due to redundancy, living in Dunedin. I’m with Mercury who have advised my that my fixed charge will go from 33.33 cents to 66.66 cents in April, and the variable rate raises from 24.98 cents to 25.22 cents/KWh.

I have been with Mercury for many years. They are so much cheaper than the previous supplier, Contact Energy.

Living alone, I use less energy. Furthermore I have invested in insulation and Heatpump technology to make my use as efficient as possible. That said, the further south one is, the more heating costs. Why did nobody consider regional differences? Surely low usage is something to be encouraged as we add new ways to use energy in the future (such as e-transport).

This is so unfair for young people, old people, single people! I accept that aspects of the power infrastructure have suffered from under-investment….so OK…some increase in fixed charges is inevitable. However, increasing both fixed and variable charges will have an excessive impact on the very folk who can’t afford it.

Previously, I’ve found powerswitch to be less than useful. Because I use relatively few kWh, expected savings from jumping to other suppliers seem low, but it’s so difficult to compare because customers seem to get a range to loyalty discounts that aren’t taken into account. In my cases, I’ve assessed the ‘savings’ from moving away from Mercury, may not be as much as the discounts I currently get. Of course, once these changes come into effect, this may change.

I hope Consumer NZ make submissions to the relevant bodies regarding this issue.

Steve

Karl O.
05 Mar 2022
switched to genesis from Nova

switched to genesis from Nova locked in for a year genesis are not increasing daily rate at this stage
. With 11% discount works out cheaper than Nova
fixed for a year with Genesis.
They also have a much better web site where you can see elect usage on a hourly basis

Margaret S.
05 Mar 2022
Solar power

I moved from Scotland to NZ 15 years ago and was surprised at the lack of solar panels on roofs. There would be way more panels on Scottish roofs than NZ with way less sunshine. Surely it is better to use roof space rather than agricultural land for solar panels? I know the Scottish government did subsidise installation, that has now changed to an interest free loan and surplus power is sold back to the grid. I don’t have solar panels because the installation in NZ is so expensive. If the cost of purchase and installation wasn’t so prohibitive, I’d have solar panels, and ideally storage batteries, tomorrow.

Craig M.
05 Mar 2022
Solar Users Doubly Penalised

We have solar and are generating and feeding back to the grid almost three times what we are using from the grid yet we continue to get penalised by low buy back rates compared to supply rates and now are going to be further penalised for being on a low use plan. It is about time the Govt started to walk the walk and encourage small scale generation which will ultimately reduce the requirement for large scale power generation schemes. Nett metering (what you produce is offset against what you use) is widely offered overseas and is a strong inducement to install solar yet I am told by the power company that it is actually illegal in NZ. It shouldn't, but institutional Government stupidity never ceases to amaze me.

Mike H.
05 Mar 2022
Line charges do need to be rationalised

It actually costs your local lines company pretty much the same to supply your house whether you use almost no electricity or lots & lots. The fixed costs are hugely, vastly greater than the variable costs, so the 'Line Charge' on my electricity bill ought logically to be a fixed amount, and not recovered from the per-kWh usage charges.

The 'Low User' tariffs were a misguided attempt to encourage people to use less electricity by providing artificial incentives - through an inflated per-kWh price - for reducing usage.
It was bad economics when it was introduced and is still bad economics today

Will C.
05 Mar 2022
Lower the Low User limit

I think the Government should have lowered the Low User limit. If it dropped to something like 4000 units, it would still help the people it was originally intended to help. I'm optimistic that innovative power companies will create low user plans for the lowest users.

Rob
05 Mar 2022
Daily user charges

We’re on a standard user plan with Nova and have been informed that our daily fixed charge is going to increase on 1 April from 75.781c per day to $1.77 (both excluding GST). This is an increase of 162% and will cost us an additional $424.86 per year (including GST).
How is this possible? And how are power companies allowed to get away with showing prices to householders that exclude GST? It’s not as if we can claim it back.

L & M L.
05 Mar 2022
kWh rate going up for us

We're also with Nova. Our exGST daily rate is going up from 154.711 to 168.75 cents. Not too bad, but our kWh rate is skyrocketing....

Currently exGST 14.229 cents, it's going to 20.518 cents! Call it a 44% increase!!

Karl O.
05 Mar 2022
cahnge co

I suggest you change power supplier asap

Paul S.
04 Mar 2022
Is the government anti solar and EV?

We've just switched to solar, and we set a budget that would mean we would offset the up front cost in 13 years, but the government's changes mean that will be pushed out a lot further. It seems that it will also bit EV owners of which we are one, because we are on an EV plan with a cheap over night rate. The move by the government appears to be completely counter intuitive with the requirement to reduce our green house gases. With the increase of power prices, and the introduction of RUC in 2024 driving an EV could choose more than an economical petrol car