Switchme Blog

Genesis Energy is due to offer their residential customers the option to pay different prices for electricity at periods of high and low demand, instead of a single flat rate 24 hours a day.

Spokesperson Richard Gordon says that they have installed 200,000 Smart Meters that have the ability to measure electricity consumption at half hourly intervals, and have a team in place working on differentiated tariffs.

Genesis Energy customers will still have the option to pay a flat rate if they prefer and the variable pricing won’t be available to all customers until they install another 300,000 smart meters.

Contact Energy have announced recently that they would install the new meters to 150,000 North Island customers, having already rolled out 60,000 in Christchurch.

They are already offering the variable rates to some Christchurch customers  but it will be two or three years until the time of day tariffs are available elsewhere.

The variable pricing could have a knock on affect for the environment, reducing the need for new power stations and relieving the strain on the national grid.

Research suggests that time of day tariffs could cut peak demand by 5 per cent, while allowing retailers to charge high rates at short notice to counter spikes in demand could cut peak demand by up to 20 per cent.

One complication is that some electricity meters are owned by retailers, some by consumers and others by lines companies, and there is no consensus either on who should be in charge of the change to smart meters or the technology they should be investing in.

A third of the 1.8 million electricity meters in New Zealand have already been upgraded to the new technology, but Jan Wright of the Paliamentary Commission for the Environment argues that lines companies are the natural custodians partly because they have an incentive to sell people electricity.

“If I were to wipe the slate clean and start again, I think what I would like to see would be the ownership of the meters in the hands of lines companies because they have an in-built incentive to keep peak power down, retailers hardly have it at all. To me the interests of households the environment and lines companies are pretty much aligned here.”

She says retailers are expecting to sell metering data to lines companies and if they can’t settle upon a price, there is the risk of lines companies installing their own secondary smart meters just to get the information they need. This is already happening in the Waikato.

Genesis state that they are committed to ensuring customers can access data information on their electricity consumption and advise that they are not in favour of allowing monopolies to have control of this.

TrustPower spokesman Graeme Purches is a smart meter sceptic and believes that retailers are already running up unexpected costs. Some are investing in smart metering as a way of getting rid of the manual meter readers, but in practice it has proved difficult to remotely communicate with the meters without interruptions he says.

Source: Stuff.co.nz

Contact Energy’s customer migration of approximately 15,000 customers has sparked some significant and generous discounts available to consumers over the last month or so, for example Contact Energy’s Online Ontime offer of 22% prompt payment discount if received and paid for online, which is estimated to cost around $14 million per year for the company.  It is expected that the popularity of this offer could result in minimal profits.

Contact Energy previously offered customers a lower prompt payment discount of 12%, but as consumers became more aware of energy retailer comparison sites such as Switchme.co.nz, they experienced a  2 month period of considerable customer loss, on average around 7,679 per month.

Although Contact’s unit prices are still significantly higher than most of their competitors before the discount, the 22% reduction has altered Contact’s competitiveness on the Switchme website.

Recently some of the smaller power companies have been able to offer extremely competitive tariffs due to low spot prices.  But Contact Energy has the expectation that the price rises will continue to climb in future years, while the recent years of reasonably low wholesale market spot prices are unlikely to be continued.

Dennis Barnes Contact’s chief executive said that there were already 20% of customers eligible for this massive discount, but that with this offer expected that to rise to 40% as they changed over to online billing and payment.

There were other large customer losses in August for Mighty River Power which is part of the Mercury Energy brand which lost over 3,000 customers –which was more than double the previous two months losses amalgamated.  TrustPower who along with Contact have always been at the higher end of tariffs, reported a loss of over 800 customers for the same period.

The major winners were Genesis Energy who won nearly 950 customers over with their tariffs and Meridian Energy who gained nearly 1000 customers.  Both of those totals consist of the new customers who joined for their online brands, Energy Online and Powershop.

Source: www.scoop.co.nz – Business Desk

Genesis is the cheapest power retailer in the Marlborough region, coming in front of newcomer Tiny Mighty Power, according to electricity comparison website Switchme.co.nz.

It rates Tiny Mighty in third place, behind Just Energy.

Genesis Energy public affairs manager Richard Gordon said the company had not increased its prices for several years, unlike other retailers, although they would be reviewed within a year.

Switchme marketing manager Scott O’Donnell said 70 per cent of Marlborough households were supplied by TrustPower, which was by far the most expensive. This meant switching to Tiny Mighty Power from TrustPower would save most customers about 11 per cent.

“However, customers can save nearly 16 per cent if they switch [from TrustPower] to Just Energy and a whopping 20 per cent if they switch to Genesis Energy.”

Contact Energy’s latest 6 per cent price hike means it is the second most expensive retailer in Marlborough.

People needed to investigate how much they could save by switching power companies and, if it was worthwhile, go ahead, he said.

“If they could just see how easy it is to switch. In five days they can be with a totally different retailer and can be saving $50 a month. People can save a lot of money and it will go back into the community.”

TrustPower spokesman Graeme Purches said power cost comparisons on websites such as Switchme were flawed because they made assumptions on usage which were not always accurate, especially for places like Marlborough where people use significantly less power than the national average.

It also did not take into account membership benefits for long-time customers, he said.

The company consistently showed it was the best for customer service, he said.

“We’ll never be the cheapest. We’re not going to be down there discounting our tail off to get customers [like other companies] because all that means is in six to 12 months’ time they have to play catch-up and get back what they lost. We’re in it for the long haul.”

Tiny Mighty Power national manager Toby Warren said about 200 customers had switched to the power retailer since it opened its Blenheim office a month ago.

Most business customers that had approached Tiny Mighty had found it cheaper, but most converts were residential, he said.

“It was bold of us to put up signs with lower power prices for Marlborough; we’re pretty happy with our success so far.

“Genesis’ power is just lower in ways that bewilder us,” he said.

The company was not shying away from its stance on providing cheaper power, he said.

“There are a range of reasons that people switch; price isn’t the only determinant.”

There had been instances where people had switched to the new company because they saw it as a more personable retailer, he said.

“We have instances where we’re not saving people much at all, but they are switching to us because we are behaving locally and committed to the town. We’re pretty local; we’re here with knobs on and for most people we’re definitely offering cheaper power.”

To compare electricity prices go to Switchme.co.nz.

Article from Marlborough Express:

http://www.stuff.co.nz/marlborough-express/news/4435269/Big-savings-possible-on-power-bills

Switchme’s response to this article:

(Brett O’Donnell) I work for Switchme and I’m keen to clear a couple of things up and establish some facts:

1. The NZ Government has identified Marlborough in the top 3 areas where customers can benefit the most from switching electricity retailers.

2. It doesn’t matter what residential plan type you’re on, or how much electricity you use. Trustpower are the most expensive retailer in Marlborough.

3. Apart from assuming the average month has 30.25 days. Switchme doesn’t assume anything in its calculation. We stand behind all calculations and figures 100%.

What customers do with the information we provide is entirely up to them. We invite residents to phone around and speak with other retailers and use other comparison sites like the Consumer Institute Powerswitch website to validate the figures.

The information we provide is not intended to put-down any electricity retailers. Trustpower are in some areas a very competitive retailer and consistently offer some of the best customer service out of all New Zealand electricity retailers.

There are other qualitative benefits of joining Trustpower which are not reflected on our site, which is why we encourage customers to gather information from a number of sources before making a decision.

Switchme is here to provide facts, assist with the switching process and to give good sound advice to electricity consumers.

(If you have questions about how to switch power companies please call us on: 0800 179 482)

70% of Marlborough use TrustPower.

Contact Energy are set to increase their electricity prices by an average of nearly six percent from today, but will still not challenge Marlborough’s most widely-used power company as the region’s most expensive retailer.

Figures applied to The Sun this week by energy comparison site “switchme” show, TrustPower, used by an estimated 70 per cent of Marlborough homes, as being nearly $15 a month more expensive than any other company, even with Contact’s Price increase.

Switchme pricing manager Brett O’Donnell says the gap between Marlborough’s most and least expensive energy company (Genesis) is one of the largest in the country, and is encouraging people to “shop around”
“TrustPower put their prices up by 4.3% in March this year and, given that nearly three quarters of all Marlborough households are with TrustPower, it makes the impact so much greater”
The figures show a “low-user” household with one or two people will pay an average of $162.56 a month with TrustPower, compared with $131.63 with Genesis.

A three to four person household will pay $258.37 compared with $206.34 respectively.

Mr. O’Donnell says the Switchme site enables people to accurately compare energy prices, something which they need to do in order to keep up with price changes.
“Power companies do what they have to under Electricity Industry rules around price rise notifications” he says.
“I personally don’t believe there is enough communication to customers.”

Contact Energy’s latest price will is one of the largest in recent years, and will see it become the region’s second most expensive retailer.

Low-user households will pay $100 extra a year for electricity, while standard-user households (three to four people) will pay an extra $150 annually.

Switchme manager Scott O’Donnell says people are often not notified of changes, and the can creep up on them. “Their bill may be more expensive but they may put it down to usage,” he says.
“”So we just wanted to notify people about who are the most expensive.  Going with another retailer they could save $30 a month”

Contact Energy communications advisor Jeremy Seed says the rise is reflective of the increasing cost of generation electricity. “We had a number of people on a pricing promise which means we don’t increase their price, but that scheme finished prior to December 1,” he says
“I’d expect there will be some residual movement from our customers, there’s always some movement when there’s a price increase.”

Read the article here: http://blenheimsun.co.nz/ (paper released week of 29th-5th December 2010)