Homeowner blindsided as daily power charges increase 600%

The owner of a Marlborough Sounds property facing a 600 percent increase in daily power changes says he’s been blindsided.

Mark, who did not want to be identified, has owned the bach for five years.

He said his power bill had previously been $50 or $60 a month but he had just been advised of a large increase in his daily fixed charge, which would rise from 60 cents to $4.24.

“I have spoken to one or two other residents who are also a bit shocked but apathy or lack of awareness is also out there.

“I am seriously considering going off-grid if I keep the property, though selling is definitely an option. Property values will likely drop though as the appeal of owning a property where supply is so expensive will wane.”

He said Powerswitch now estimated his bill would be more than $3000 a year if he spent 60 days a year there.

“We are told that the cost to supply to remote areas is the problem, but the infrastructure is in place and there is almost no expansion as there are no more sections being developed.

“I was also told by Genesis call centre that there is no option to suspend supply if not occupying a property for a few months – the daily charges would still apply and even to decommission altogether would face a charge.”

Lines charges are increasing around the country after the Commerce Commission approved transmission price increases from the start of April.

On top of that, the low-user scheme is being phased out, which means a 30c-per-day increase in fixed charges for people affected.

There was pressure on the price of electricity as well.

Mark said he had been quoted up to $30,000 to go off grid but it could pay for itself in a decade.

Genesis said the price increase had been heightened because of a change specific to Mark’s circumstances.

“The local lines company in Marlborough service the area and classify the customer as remote, due to their location in the Marlborough Sounds.

“The lines company’s daily charge has increased from $3.11 to $4.00. Previously, only 60c of the fee was passed on to the customer who was on a low-user plan.

“That low-user plan is not available for this customer now based on the lines company rating the property as remote and being a secondary property (bach).

“The full charge from the lines company is now being included in the bill.”

Marlborough Lines said, if the connection was remote, it should have been on its remote price plan.

It had a ministerial exemption that allowed it not to offer low-user prices to remote connections.

“The daily fixed charge for that is much higher than a low-user daily fixed charge – note though that our variable charges for low users is considerably higher than variable charges for other connections.

“It’s possible that the retailer had their customer on a low-user plan, but we did not as they were remote and not eligible.

“The retailer may have at some point moved them off their low-user plan after realising we had them on a remote plan.”

Powerswitch general manger Paul Fuge said there was no obligation for power companies to offer a low-fixed charge option to baches.

“When customers sign up with a retailer, they are usually asked whether the property is their primary residence. However, it’s unclear what verification processes – if any – retailers use to confirm this.

“While I don’t have specific data, it wouldn’t be surprising if some consumers have signed up secondary residences with retailers as their primary home to access the LFC option.

“It’s unlikely to be straightforward for a retailer or lines company to determine otherwise,” Fuge said.

“They might attempt to use other data sets – or assess consumption patterns, but with today’s diverse household usage profiles, that approach would be challenging and unreliable.

“In our experience, some retailers and lines companies are more diligent than others when it comes to checking this.

“That said, I’ve never seen a case where a household already on an LFC option was removed based on a determination that the property wasn’t a primary residence – though it may happen occasionally, it doesn’t appear to be common, at least based on the complaints we receive.”

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