From dodgy discounts to blatant greenwashing and wholesale price manipulation, Electric Kiwi has been calling out the crap in New Zealand’s energy market for several years. Why? Well, because we don’t just care about offering our customers good deals, we want to make things better for all Kiwis.
Being on the inside of the industry, we have a unique view of the dubious tactics employed by some retailers and see where things can be improved. That’s why we speak out like we do (or shout if people don’t listen the first time!). We’ve been doing it in energy for a while, and now we’re getting to know broadband, we’ll be doing it here, too.
Here’s a quick overview of the campaigns we’ve led over the years and things we’ve helped change for the better. We don’t just do it for attention, we do it because it’s the right thing to do. If you learn of any industry antics that are unfair or unreasonable, drop us a line and we will take a look.
Prompt payment discounts
Back in 2019, we started to shout from the rooftops about the wolf in sheep’s clothing that was prompt payment discounts. The problem was, retailers were basically charging people more than they needed to, so they could pretend to give them an awesome discount, up to 20-odd per cent we were seeing at the time. Electric Kiwi never did this because it stank.
Inflating prices to create the illusion of great savings was an incredibly cynical move on the part of some retailers, and inevitably saw the most vulnerable customers hit with large bills should they fail to pay on time. Thankfully our concerns cut through and by the end of that year, the government started to share our views, beginning the journey to the end of these types of excessive, hidden late payment penalties dressed up as discounts.
Customer saves and win backs
Another major bee in our bonnet over the years has been the grubby practice of customer ‘saves’ and win backs – basically when your old retailer suddenly conjures up a better deal to keep you after you’ve set the wheels in motion to switch. Not only was it a horribly cynical tactic to retain customers, it highlighted the loyalty tax that other customers were paying just to subsidise the savings of those who were the most ‘valuable’ to the retailer.
As a price-competitive retailer that attracts new customers from the incumbents, and others, we saw first hand how people were duped into staying with their old supplier, even when the new deal they were offered wasn’t as good as they could have got by switching but was just about enough to convince them to stay. How bad is that! It was an anti-competitive practice that favoured the big retailers and undermined the retail competition that consumers benefit from.
We campaigned in public and lobbied the industry authorities to understand our point of view on the subject over a two-year period and thankfully in 2020 the Electricity Authority came up with the goods, banning saves and win backs and setting in place new, fairer rules that allow retailers to compete for customers on a level playing field, while consumers can benefit from the competitive prices that healthy competition brings.
UTS complaint against gentailers
We’ve long called out New Zealand’s big ‘gentailers’ when we believe they’ve manipulated energy prices to their own benefit and argued that these businesses – especially Meridian – should be broken up to avoid the clear conflict of interest between their retail and wholesale obligations.
Our anger reached new heights in August 2021 when a power outage in parts of the country occurred because these gentailers failed to adequately meet the high seasonal demand that was predicted. We filed a ‘UTS’ (undesirable trading situation) complaint with the Electricity Authority alleging that Genesis and Contact Energy abused their market power and withheld generation in the run-up to the outage. Electricity spot prices soared that evening and the next morning and consumers have been left to foot the bill.
The fundamental issue was that Genesis was basing its decision on the power it needed to generate to supply its retail customers, and meet its contractual obligations with wholesale customers, rather than the needs of the whole market. Problem in a nutshell.
Meridian greenwashing ad
The only thing we hate as much as wholesale market manipulation is greenwashing. That’s exactly what Meridian was found guilty of by NZ’s advertising watchdog when the company tried to convince customers that they were buying renewable energy in a dodgy TV ad back in late 2020.
Not content with sitting back and letting them get away with this, we issued a complaint to the Advertising Standards Authority (ASA) explaining that – despite Merdian’s best efforts – the energy it sells is no greener than the energy sold by any other retailer, as the ad implied.
“Doing your bit for the environment just got easier,” Merdian had the nerve to claim in the ad. This simply conflated the company’s renewable generation assets with the power customers can expect to receive through the lines, which comes from all power sources. As we move to a greener, more sustainable energy future, it’s important that retailers are responsible in how they promote themselves and their products and this seriously fell short of what Kiwis should expect.
The ASA agreed with our complaint, and the ad was quickly ordered off air. Needless to say, we now watch every Meridian ad carefully.
Prehistoric broadband contracts
Now we’re getting to know broadband better, we’re ready to start calling out the BS contract terms and charges that some of the big telcos have been getting away with forever and are never challenged on. That’s going to change. We’re particularly aggrieved about the 30-day notice periods some providers insist upon when households notify them of their intention to leave. Why should they trouser an extra month’s fee when the customer is done with them? Let’s be clear, they do it to make things more difficult for customers to switch, and no doubt it puts people off. Electric Kiwi charges for broadband by the day, not the month, so you’ll only ever pay for what you need. It’s the fairer way of doing it.
Things like contracts, exit fees and expiring discounts are prehistoric stuff. We don’t and won’t lock anyone into contracts for our broadband or electricity products because we’re customers ourselves and we know they suck. We’d like to see all providers drop them – and we’re going to start shouting about it. Watch this space.
We’ll always stand up for what’s right
We don’t enjoy getting into fights (OK, maybe we do in a way). But we’ll always speak out if we see something dodge in the world of energy or broadband.
Unmasking is another of our favourite pastimes… like when we called out ‘Frank Energy’ for actually being Genesis in disguise. They failed to mention this on the Frank Energy site until we called them out about it, obviously. Pretending your tired old retail brand is actually a fun, easygoing trend-setter is about as cynical as it gets in this industry. We won’t let them do it.
We acknowledge that some of the issues we’ve campaigned about might actually be in our business interests (e.g., banning customer win backs) and we don’t pretend otherwise. But that’s not the main reason we do it. It’s a nice bonus, but first and foremost it’s about holding power to account and standing up for consumers.
You can run a successful business and do the right thing by people. These are not mutually exclusive ideas. In fact, in our experience, one leads to the other. That’s what we’re all about at Electric Kiwi.
