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Switching retailers a growing trend

More households than ever are switching electricity retailers to secure a better deal.

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New Zealand households are actively looking for a cheaper electricity deal.

In the 7 months from June to December 2011 while the first What’s My Number campaign was underway, there was a 400 percent increase in switch initiations (42,687 versus 8500 for all of 2010) on Powerswitch. There was also a huge increase in visitors to the Powerswitch site with 465,000 visitors compared with 191,000 the year before.

In the same period, Electricity Authority figures reveal 244,199 customers switched to a different electricity retailer. This is an increase of around 28 percent over the previous year’s figure of 191,337 switching customers.

This dramatic increase in customer switching is likely to escalate further owing to the high-profile Powerswitch and What’s My Number campaigns as well as rising power prices.

The Powerswitch website features calculators that compare the current electricity and gas prices offered by retailers, and can help customers actively switch to a new retailer if they find a better plan or offer.

The number of households switching electricity retailers indicates healthier competition in the electricity market. As consumers use comparison websites such as Powerswitch and change retailers when a better deal is available, more pressure is put on electricity retailers to ensure their prices are competitive.

This growing awareness that consumers can influence retail pricing is shown by the number of those voting with their feet and their wallets in switching to the most competitive retailer. For example, the June 2011 switching figures of over 42,000 are in stark contrast to the customer inertia of 6 years before when less than 15,000