Powershop expands renewable energy shop

Powershop's online shop in Australia includes electricity from sugarcane biomass. Photo / Johan Larson

Meridian subsidiary Powershop has added renewable energy to its online shop in Australia, allowing customers to choose the kind of power they want to support.

Powershop, which started operating in 2009, works differently from most other electricity retailers. While customers can opt for normal monthly billing, they can also choose to take an active role in their electricity consumption by monitoring it online and buying pre-paid packs to take advantage of special deals.

The company claims about 53,000 customers in New Zealand, or about three per cent of the national electricity retail market. That's a modest following but one that's grown quickly - and a May 2013 survey by Consumer NZ found customer satisfaction ratings were the highest among electricity retailers in New Zealand.

The next challenge for the company is cracking the market in Australia. Following its official launch in the state of Victoria in December 2013, the company has grown to about 5000 customers in that country.

"It's going really well," Powershop CEO Ari Sargent said. "Because it's different, it's interesting to people... We're seeing the same word of mouth as we did in New Zealand."

Customers in Australia, unlike those in New Zealand, can also choose to buy specific types of power, including options from two wind farm operators (including Meridian), landfill gas generator LMS Energy and community renewable generation projects facilitated by non-profit Embark Australia.

The first renewable and alternative energy packs became available on February 5, with an extra option - "sugar power" generated by burning waste biomass from sugar mills - added on February 17.

Powershop purchases units from the generators and sells them at retail rates, passing a cut back to the supplier. "It's allowing customers direct access to those smaller generators," Sargent said.

It's unlikely at this point that Powershop will introduce a similar option in New Zealand, as between 70 and 80 per cent of the nation's electricity is supplied using renewable resources. In Australia, that figure was just 13 per cent in 2012, leading to stronger public interest in being able to support specific types of generation.

Powershop is now profitable and "self-sustaining" in New Zealand, Sargent said. The company sees Australia as an opportunity for growth. "We won't rush into other states but we'll certainly explore options," he said.

Other plans ahead include a closer look at solar power in New Zealand.

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