For Hastings resident Sharon Sutton, April 1 will be a double whammy, because her daily charge with Frank Energy is also rising 31%.
Sutton said her daily charge for power was $1.35 up until August 14, 2024. On August 15, it increased to $1.51. Now, it’s set to rise again to $1.98 in April. The daily charge alone is an effective increase to Sutton’s power bill of $19 a month.
Frank Energy says the large increase is because a delayed price review meant customers were sitting on an old plan for four months.
“How is this even legal? It is certainly immoral.”
Sutton said she tried to negotiate with Frank Energy but received only templated responses at first and even was encouraged to switch companies if she wasn’t satisfied.
An Energy Authority spokesperson says over 90% of people who compare energy plans can save by switching companies, with average savings about $400 a year.
“There are lots of power companies in New Zealand who regularly have new plans and special offers for new customers. It’s definitely worth shopping around,” they say.
The Energy Competition Task Force has recently proposed measures to prevent large generator-retailers from favouring their retail arms in hedge contracts, ensuring competition and lower prices for consumers.
For Sutton, who has spent more than a decade tracking her bill and seeking the best deals across multiple providers, there doesn’t feel like any “honest competition”.
Sutton said she has switched companies several times, only to repeatedly face unexpected price hikes, often within months of joining a new provider.
“They use smoke and mirrors tactics, they’ll offer bundles and specials, but then they raise their prices at different times of the year, so you can never stop those escalators at any point and compare,” she said.
Sutton told Hawke’s Bay Today her family has worked hard to reduce their power consumption.
A decade ago, they used 10,000kWh annually, but as prices rose, they cut that down to 8000kWh, all while raising a family of four, including a child with special needs.
“We don’t have heat pumps in the winter because we can’t afford it. I get up every morning between two and three and put more wood on our fire to keep ourselves warm.”
According to a Frank Energy spokesperson, Sutton was previously on a 2023 pricing plan, because of a delayed price review.
“Pricing cycles are aligned normally to April when lines companies review their rates. Last year, however, Frank’s annual price review was delayed until August, leaving customers on old rates for an extra four months.”
The company says Sutton could save $32 a year right now by switching to a low-user plan, which has a lower fixed charge and a higher variable rate.
But Sutton says the option “wouldn’t make it much better,” as the Low Fixed Charge (LFC) is slowly being disbanded.
The scheme, which offers lower daily charges for low-use households, is being phased out by the Government over five years, with all residential customers set to pay the same fixed charge by 2027.
A Frank Energy spokesperson says that as part of the Government’s phase-out of LFC regulations, the daily fixed charge for low-user plans, will rise “from 90c/kWh to $1.20/kWh annually until phased out in 2027”.
As a result of this, and rising transmission and lines company costs, from March 2025, Frank Energy’s residential customers in Hawke’s Bay will see an average 14% increase in bills.
While affordability is a challenge for Sutton, she argues the bigger issue is fairness.
“Even for families who don’t struggle, power companies should not impose unreasonable price hikes. Any increase above inflation should be legislated against. Why isn’t it?”
'We can't afford heat pumps' - During winter, Sharon Sutton wakes up nightly to add wood to the fire and keep her house warm. Photo / Rafaella Melo
Ministry of Business Innovation & Employment (MBIE) spokeswoman Tamara Linnhoff told Hawke’s Bay Today that while LFC reduced bills for some consumers on low-user plans, it did so by increasing costs for higher-user consumers, which could mean big families even on low income.
To assist with rising costs, the industry has introduced the Power Credits Scheme, offering a $110 power credit to those affected by the LFC phase-out.
“The Power Credits Scheme is administered by electricity retailers. Anyone struggling with their power bills [...] is encouraged to contact their power company,” Linnhoff says.
Customers can get a $110 power credit from their electricity providers if they:
• Are finding it hard to pay their electricity bill
• Have been on a low-use electricity plan within the last six months, and
• Have had a recent price rise.
Customers can get up to two credits in a 12-month period. More information is available on the MBIE website.
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