Power company's 'unfair' online discount

By Brenda Harwood of The Star - Dunedin

A Dunedin couple say it's unfair they're not eligible to receive an online 22% discount on their electricity bill. Photo / Thinkstock
A Dunedin couple say it's unfair they're not eligible to receive an online 22% discount on their electricity bill. Photo / Thinkstock

A Dunedin couple are feeling left out in the cold after receiving a letter from Contact Energy with their power bill this week.

Geoff and Eve Thomson, who do not own a computer and have no interest in internet banking, were less than impressed with the letter's offer of a "whopping 22 per cent prompt payment discount" to customers who receive and pay their power bills online.

As long-standing Contact Energy customers over many years, Mr and Mrs Thomson pay their bills on time through the Post Shop by preference, receiving a 10 per cent discount.

"When you go into the Post Shop with the money and walk away with the receipt, you know the bill has been paid and the lights will stay on," Mrs Thomson said.

The couple calculate that paying their latest bill of $200 at the Post Shop will earn them a "prompt payment" discount of $20 compared with a $45 discount for paying the same amount online.

"That is a very big difference," Mrs Thomson said.

"There are a lot of things we could do with an extra $25 - there's quite a bit you could get in the supermarket with that," Mr Thomson said.

The couple see the discrepancy between the two discount rates as "grossly unfair" and are concerned the new policy will disadvantage older people and those on low incomes who may not have access to computers and internet banking.

"I feel sorry for many older and low-income people who struggle to pay their power bills anyway," Mr Thomson said.

"This move just disadvantages them further."

Contact Energy retail general manager Ruth Bound said there had been "a phenomenally positive response" from customers to the offer and the number of people now using the service was "increasing every day".

"Contact does not accept that the discount is discriminatory to either the elderly or those on low incomes as internet use and access in New Zealand households is extremely high," Ms Bound said.

The Statistics New Zealand 2009 Household use of Information and Communication Technology Survey showed that 75 per cent of New Zealand households had access to the internet at home and it was reasonable to assume that the percentage was even higher now, she said.

"People wishing to take up Contact's offer who do not have a home computer can easily access the internet at community facilities such as libraries and community centres or by using a relative's, family member's or neighbour's internet connection," Ms Bound said.

Meridian Energy retail general manager Bill Highet said, when contacted, that the company "would love to be dealing with all of our customers online" and did offer some incentives.

"However, we realise that not everyone has computer access and feel that it is a bit unfair to offer a discount that is so much higher to online customers," Mr Highet said.

While it was more expensive to post bills to people and deal with over-the-counter payments, Meridian handled this by charging a modest $1.50 fee.

Attempts by The Star to contact representatives of other power companies for comment yesterday were unsuccessful.

Contacted by The Star, a Commerce Commission spokeswoman said the issue of the Contact Energy online discount had been raised with the commission by other complainants. However, under the Fair Trading Act, it was permissible for a business to make such an offer as it was not misleading to customers.

"In this instance, there is choice for consumers," the spokeswoman said.

Grey Power national president agreed with the Thomsons the online discount was unfair and said the organisation had heard about it from "quite a few" members.

"It is unfair - there are a lot of elderly people who will never touch a computer," Mr Reid said.


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