Contact Energy is raising power charges for the third consecutive year - this time up to 14 per cent.
The electricity producer yesterday announced an average increase of 5.5 per cent in Northland, with Far North business customers the worst hit as they will face a 14 per cent increase.
Residential customers in the area will receive an average 11.8 per cent increase from April 1.
Contact spokesman Jeremy Seed said 85 per cent of the Far North increase was due to a significant rise in charges from lines company Top Energy and Transpower.
Across Northland, rates will increase by 6 per cent for business customers and 4.4 per cent for residential customers.
Contact has about 15,000 residential and 2500 business customers in the Far North, and about 3300 residential and 290 business customers in Whangarei. The latest increase follows a 7 per cent hike last year and a 3.2 per cent rise in 2010 in Northland.
Mr Seed said the company's retail prices were based on providing a stable, reliable energy supply but that Contact must ensure it covered its costs and made an acceptable return on investments.
"Retail electricity margins are low, and the decision to make changes like this is not taken lightly, but we must make these changes to ensure that we both cover our costs and make a commercially acceptable return on our investments."
As a listed company, he said Contact needed to remain profitable so that shareholders continued to invest in it.
"We give our customers good reason to stay and expect they will. However, it's an open market and customers have choices, so they will ultimately decide what's best for them," Mr Seed said. Contact Energy has about 443,000 residential and business electricity customers nationwide.
Rates will rise by an average of 5.5 per cent in 22 regions, including Auckland, the North Shore, Northland, Counties, Wellington, Christchurch and Dunedin.
The company has warned customers to brace themselves for increases until 2015, when most projects will be completed.
Lines charges account for around 40 per cent of customer bills.
Earlier this month Mercury Energy announced a 5.8 per cent increase in power prices for households from April 1, pointing to lines charges as the reason for the increase.
Consumer NZ chief executive Sue Chetwin reportedly said some power firms would absorb the increases and that people should shop around to find the best deal for them.