Power costs a big worry for one in three Kiwis, Consumer NZ finds

Higher power use under lockdown set to worsen the financial impact of Covid-19.

Father holding crying toddler in cold home.

Household power costs are a major concern for a third of Kiwis, Consumer NZ’s latest electricity survey shows.

Consumer NZ chief executive Jon Duffy said households already struggling with costs were now facing higher bills as power use jumped with the Covid-19 lockdown.

“Our survey found 63% of consumers were concerned about what they paid. For 32%, power costs were a significant concern,” Mr Duffy said.

Results also showed one in six consumers had experienced financial difficulty paying their monthly power bills in the past year.

Mr Duffy said the number of households finding it hard to pay was likely to increase as the financial impacts of the Covid-19 crisis started to bite.

“As the colder months approach, domestic power use will rise. Consumers who are already doing it tough are going to be the hardest hit by winter bills,” he said.

Consumer NZ is calling on the big five power companies to set up hardship funds to support customers having difficulty paying.

“We’ve also asked these companies to drop late-payment fees. Charging these fees just isn’t the right thing to do at this time,” Mr Duffy said.

While the major companies have stated they won’t charge these fees to customers affected by Covid-19, only Meridian had removed “prompt-payment discounts” entirely.

Mr Duffy said these discounts unfairly penalised customers who can’t pay their bills early.

In bills sent out this month, Trustpower was continuing to apply its 15% “prompt-payment discount”. Mr Duffy said this discount was effectively a 15% late-payment penalty for customers who couldn’t pay by the due date.

Last year, Minister of Energy and Resources Megan Woods wrote to power companies requesting they remove prompt-payment discounts and ensure all customers received the discounted rate.

“These discounts are a late-payment fee in disguise and have a significant impact on households who can least afford it. There’s no justification for continuing to charge them,” said Mr Duffy.

Support needed for consumers in financial hardship

Support needed for consumers in financial hardship

20apr support needed for consumers in financial hardship promo

Support needed for consumers in financial hardship

The Covid-19 lockdown means hundreds of thousands of Kiwis face having to survive on a reduced income. We’ve joined with 14 other organisations in calling on essential service providers to do the right thing and halt disconnections, waive late fees and pause debt collection.

Learn more

Stay in the know

Keep up-to-date with Consumer's latest news, investigations and product and service reviews, plus join the Consumer panel with invitations to take part in surveys.

Your support goes a long way

Your support goes a long way

Young boy sticking drawing to window.

Your support goes a long way

When big things like the Covid-19 pandemic happen, we all have a role to play in helping each other get through. Our role is to provide independent, expert advice and fearlessly advocate on behalf of all consumers during this uncertain time. Can you help with a regular or one-off donation?

Donate to Consumer

Coronavirus (Covid-19)

Coronavirus (Covid-19)

Crowd of people walking.

Coronavirus (Covid-19)

Read our latest articles on the Covid-19 pandemic. Got a consumer-related question about coronavirus? Email us at info@consumer.org.nz and we'll do our best to help.

Member comments

Get access to comment

Diana
25 Apr 2020
Power charges

I struggle (mentally) with the removal of the say 15% discount no longer being transparent. Reason - if all companies remove it (the $ amount clearly shown) but don't adjust the price down accordingly, (no longer showing) this will potentially result in a cost rise for all payers as they "cover" a non payment debts. For those who can't pay (regardless either way) is there not a concern that it will make it harder, not easier to to pay for power if this is the outcome. While the discount was clearly identified in $ terms, then it is personal debt. As a Pensioner, I pay my bill on time so not wanting to be penalised for those who don't. Your thoughts. Di