Powershop 33% increase

[ionna]

@diane44 I live alone which probably makes a massive difference! I probably do one load of washing a day or every second day and I don’t use the dryer much at the moment. The only thing running consistently is my fridge.

I have gas heating/stove/water so that probably makes a big difference?

I feel like any house with kids goes up a lot just because of all the washing and drying that needs to be done.

 

[catholicbat]

@totlanh This ranks up there with rnz article on knowing when to give up leftovers and supermarket receipts going all Kia kaha with a hotline for stress

 

[guadalupana]

@rickt65 Powershop does work differently to other power companies. Try one of those comparison sites and see if you can get a better deal elsewhere.
I changed from Electric Kiwi to Flick and my bills halved.

 

[olympica]

@guadalupana Flick are also charging $1.38/day for low users as far as I'm aware - very few retailers are offering less (doing so means they'd have to absorb the network's higher daily charges by having higher variable rates generally).

 

[babychristian10]

@olympica Our daily is 45¢ and going up soon... I doubt we could get anywhere near the same rate if we switched now. Even Nau mai rā are applying daily charges now.

 

[catb]

@guadalupana I just did my own annual comparison. I run current prices against my last 12 months consumption. My actual usage over the next 12 may be different, but it’s all relative.

Flick Off Peak still comes out ahead, even with the 1 April increase. Followed closely by Flick Flat (+$180 p.a.) then Genesis (+$345 p.a). 2Degrees was the worst at +$2.6k p.a.

 

[imperfectdesciple]

@rickt65 I’m still extremely fucking salty that the govt made power companies do away with prompt payment discounts. Power went up 25% in an instant.

 

[pfm1999]

@imperfectdesciple That wasn't a discount it was a late payment penalty...

i used to work for a very large power company in NZ about ten years ago, selling power and services, I would often increase prompt pay discounts on customers who threatened to leave and requested a "Discount" but in return they couldn't leave for 12 months..

I remember when another large power company started to gain traction and the colleges and associates in the industry were told not to worry as "they will put their prices up In 12 months"
So retention teams only had to keep customers for 12 months.

And like clockwork - the prices went up

 

[imperfectdesciple]

@pfm1999 Well as someone who never paid late, happy discounts to me.

 

[havemercy2017]

@imperfectdesciple No... that's the psychology winning... happy normal rates to you

 

[imperfectdesciple]

@havemercy2017 Call it what you want. I paid less before. I pay more now. And that sucks.

 

[godisbigger]

@imperfectdesciple So you'd rather power companies ransom a larger amount initially, and then give you back some money if you manage to pay according to their timeframe?

That's not a discount; that's a late fee that's been pre-applied to your bill.

 

[imperfectdesciple]

@godisbigger You can cut it all sorts of ways. Fact is - my power went up 25% as a result

 

[nescafegirl89]

@godisbigger Did the government mandate that the power companies have to lower their charges for those who don't pre-pay? If not, does that mean that power companies now earn more with the removal of prepayment and lower-users?

 

[godisbigger]

@nescafegirl89

Did the government mandate that the power companies have to lower their charges for those who don't pre-pay?

No. The government's role here was to reduce obfuscation made by power companies and make it easier for the consumer to make informed decisions; it's much easier to compare power companies when the only numbers you need to compare are KWh and daily charges.

If not, does that mean that power companies now earn more with the removal of prepayment and lower-users?

Not necessarily. The removal of pre-fining everyone a late-fee is literally the company overcharging you, but the reversal of the overcharge makes it "feel" like a discount. That money always belonged to you, but they ransom it up front so that you have to claw back.

Taking the pre-fining ability away surely means that there's less sneaky ways to profit; now you actually have to "commit the crime" of being late on your bill, whereas before everyone treated as if they had already committed the crime, unless proven otherwise.

In terms of the removal of low-user tarrifs, the government thinks it will have a positive effect on the system, both socially and economically in terms of health and efficiency. They regard the lower user tarrif to:

• create an unfair playing field
• are poorly targeted
• create a barrier to better distribution pricing
• can encourage households to under-heat their homes
• create confusion
• discourage uptake of electric vehicles and other electric, more sustainable technologies
• favour households that can afford to be energy efficient and install solar panels
• are impeding environmental efforts as people use alternative energy sources to compensate

 

[nescafegirl89]

@godisbigger

Not necessarily. The removal of pre-fining everyone a late-fee is literally the company overcharging you, but the reversal of the overcharge makes it "feel" like a discount. That money always belonged to you, but they ransom it up front so that you have to claw back.

I didn't phrase my question properly. Let's say that customers who don't prepay get charged $100 while customers who prepay only get charged $90. When the prepay discount was removed, do all customers now have to pay $100? If yes, doesn't that mean that power companies now just earn more? They should have at least lower the charge for something.

 

[godisbigger]

@nescafegirl89

Let's say that customers who don't prepay get charged $100 while customers who prepay only get charged $90. When the prepay discount was removed, do all customers now have to pay $100?

The company probably makes less money after the change because the "discount" has always been artificial and their price is subject to competition. Let's remember that technically both people in your example should be billed $90, and if late an extra $10. Whereas before both were billed $100 inclusive of the pre-applied late fee that the power company remove later, which makes it look like a discount. Now the power company can't pre-ransom the fee so they can't invest it, and it probably helps people avoid the fee if they have to be proven to be late, rather than having to prove that they are not late. The burden of proof is now on the power company.

It also reduces obfuscation which leads to more healthy competition, and reduces hardship for those whom can barely afford it to begin with. Overall I'd say this reduces profit for the power companies, allows people to keep more of their own money and makes the system fairer.

However, the caveat here is that it's dependent on the company and whether competition and if the free market decides to adjust the price. For example, if there's only 1 power company or if all the power companies colluded, they can just keep charging everyone $100 with no offer of discount and justify it because "the government removed the Prompt Payment Discounts (PPDs)" and just keep the price as-is while removing the "discount"; effectively increasing the price. In such circumstances, it will lead to higher profits because they didn't need to compensate alongside everyone else.

So, it's not necessarily the case that power companies will profit more with the change, but it is obviously theoretically possible. In reality I'd think that they'd profit less, but I'm not an expert economist or energy specialist. However, let me leave you with a question that may help us answer at an intuition level:

Do we really think the power company bean counters would offer PPDs in the first place if it wasn't more profitable/advantageous than not having them?

 

[nescafegirl89]

@godisbigger

However, the caveat here is that it's dependent on the company and whether competition and of the free market decides to adjust the price.

That's my concern which is why I'm asking whether the prices have dropped.

Do we really think the power company bean counters would offer PPDs in the first place if it wasn't more profitable/advantageous than not having them?

Perhaps the first power company who implemented PPDs figured out that offering PPDs will increase the number of customers thus still increasing profit.

 

[dmmahan22]

@rickt65 Just compare other plans and switch.
https://www.powerswitch.org.nz/

 

[keepingthehope77]

@rickt65 The problem is obviously yes, low user tariffs rates are being made redundant. Yes this will disadvantage people but all changes disadvantage some people. However, when you’ve worked in electricity for a long time, you get to see the disadvantages of having the low and standard user plans as well.

When consumers are saying that their power bills are going up by 300% or 200% I just know that they are not actually looking at it and comparing their bills because the price increases are coming through the fixed daily charge so if you getting a price increase from $.30-$.90 on a fixed daily charge the difference is only about $18-$20. Which can be a lot of money for some but overall the usage rates are going to come down and they are coming down with these changes (Im seeing it happen across all retailers).

Coming from somebody who works in the electricity industry, loyalty does not exist anymore. Switch power companies when it suits you. Do not stay with the power company for loyalty. Compare your bills often so that you know what the market is currently looking like. Price increases every year on 1 April. Stop giving in to joining credits that put you in contract.

Look into your power usage. Turn off idle devices when you’re not using them. Speak to an electrician or heat pump installer on how to best use your heat pump during the summer and winter. Do not purchase an oil heater or 2400Kwh heater and then run it all day every day and expect your power to not be high. Most people I talk to who complain of high bills either have high rates or high usage - both are mostly resolvable by looking into your usage and looking into different power companies.

Also get a smart meter, I’m so sick of people refusing a smart meter but then having the audacity to complain that their billing is not accurate.

Flick Energy is currently the cheapest retailer and that’s coming from somebody who does not work for Flick Energy.