An Auckland solo mother who often borrows money to pay power, cooks dinner late for the seven young grandchildren living with her if it's cold, so she can heat up the house at the same time.

Findings from the Government's Electricity Pricing Review out today reveal 175,000 households nationwide spend more than ten per cent of their income on power, when housing costs are included. Excluding housing costs, 103,000 households are spending more than 10 per cent on power.

The report also reveals that while pricing could be fairer and cheaper, grid operator Transpower and distributors, as well as retailers, were not making "excessive profits".

Karina Tipene is on a supported living benefit which entitles her to $183 per week, with the rent for her five-bedroom state house in Pakuranga automatically shaving a further $104 off, and $50 being redirected to Work and Income to pay for power.

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She relies on her part-time job of two days a week of homecare for a woman which brings in an extra $80 per week, as well as her four adult children staying with her to chip in where they can.

Tipene isn't left with much for food and petrol, let alone other living costs.

"At the moment there's 12 of us here, due to circumstances they're here for a little while," Tipene says.

"But my younger grandchildren ... like today for instance, it's cold. Tonight is going to be a little bit colder so those younger children will be here in the lounge and we sort of just marae style. Out with the mattresses, all sleeping in the lounge and we know they will be warm and we know they're going to be fine."

Tipene likes to have dinner on the table by 6pm but says "if it's cold, dinner will be late".

"So you can use the heat from the stove or the oven or both ... Heat up the house, feed the children, bath them, let them have a bit of time and then they can go to bed and the house is still warm," she says.

"It's not an ideal thing to send them to bed too late on a full stomach but sometimes it can't be helped."

Karina Tipene cooks dinner late when it's cold to heat the house up for her seven young grandchildren.
Karina Tipene cooks dinner late when it's cold to heat the house up for her seven young grandchildren.

She counts herself lucky that she's crafty at whipping up meals with next to nothing in the pantry.

"There's always the good old staple mince ... One pot throw everything in, there you go," she says. "And a hell of a lot of bread."

As for how Tipene's power woes spiralled out of control, she blames signing up for prompt payment discounts about two years ago with Contact Energy.

Contact Energy is one of many retailers which offer discounts of anywhere between 10 and 20 per cent to customers if they pay their power bills on time. The scheme has previously been dubbed a "late penalty payment".

Tipene has never managed to pay on time. "It meant I always paid the full power bill that they send out ... And eventually that builds up."

That's led to her having to resort to borrowing up to $600 a time from Cash Converters on five occasions over the past two years.

"Half of that, maybe three quarters, will go to power and the rest of it will top up the cupboards."

Just recently, she had to take the unusual step of asking Work and Income for help to cover a $726 power bill. "So the repercussion of that ... I get $50 taken out of my benefit as a redirection to pay the power. And then on top of that I have to pay Work and Income back."

Tipene says she hasn't resorted to going to Winz in a long time. "When you're just about ready to be disconnected then well, yeah you have to do something."

A Contact Energy spokesperson says the "vast majority" of its customers pay on time and get prompt payment discounts.

"Contact offers a number of solutions specifically designed to help people manage their bills," the spokesperson says.

A recent survey by One Big Switch found a tenth of the more than 4,500 Kiwis who responded borrowed money to pay their power bills.

Tim Rudkin, who started up One Big Switch in New Zealand and a bulk bargaining campaign seeking 20,000 households to bring down the price of power, says prompt payment discounts rarely provide greater savings to customers.

"The issue for consumers that miss a payment date with a prompt payment discount offer is that they can fall into a debt trap where they can be paying hundreds of dollars more per year," he says.

"This situation can be compounded by an inability for the consumer to switch to a non-prompt payment discount offer as the incumbent retailer will not release the customer until the outstanding debt is repaid – creating a debt trapped consumer."

The Electricity Pricing Review also highlights issues with prompt payment discounts in how they target lower income Kiwis who often miss out on the discounts of up to 26 per cent.

The review also points to a range of other issues within the sector, including the widening gap between people who actively shop around for better deals benefiting from competition, compared to those who don't, who then end up paying more.

Consumer New Zealand's head of research, Jessica Wilson, says access to affordable power was "a basic human right" that the industry is failing to deliver.

Last year, 25,317 people had their power disconnected because of unpaid bills, up from 19,106 in 2015.

Wilson hopes the Electricity Review's final report, due out May next year, will recommend changes to ensure customers get power at a fair price.