Energy hardship: We need to know the size of the problem we’re trying to solve - Meridian Energy boss Neal Barclay

MBIE estimates that 110,000 households can’t afford to keep their homes adequately warm – that’s about 300,000 people.

THREE KEY FACTS

• ‘Energy hardship’ is when individuals and households are not able to obtain and afford adequate energy services to support their wellbeing.
• This includes an inability to pay electricity, gas rates, or water bills on time more than once in the past 12 months.
• MBIE estimates that 110,000 households can’t afford to keep their homes adequately warm – that’s about 300,000 people.

Neal Barclay is the chief executive of Meridian Energy.

OPINION

Energy hardship is a very real issue in our country, and one affecting an increasing number of households as cost-of-living pressures bite.

Any time energy hardship is talked about, it’s an emotional discussion. That’s understandable – no one likes the idea of a family struggling to pay their power bill and having their electricity promptly cut off for non-payment.

Which is exactly why at Meridian, we don’t do it. It would be completely unethical and would go against everything we stand for.

And so we are concerned that the figure of 40,000 – credited to Consumer NZ and published multiple times in the Herald over the past week – has been promoted as the number of families that have had their power disconnected over the past year.

We are intimately involved in selling electricity to many Kiwi homes, and we believe that number is far from accurate.

The Electricity Authority, the industry’s independent regulator, requires all retailers to disclose their disconnection data, which is then published on the authority’s website. Their figure for all residential disconnections for the year to the end of May 2024 was 6932.

And at Meridian, the total number of customers we disconnected over that same period was just 455 across both our Meridian and Powershop brands.

That’s a long way from 40,000, which is sometimes explained as including estimates of how many people don’t top up their pre-pay accounts – a type of account that Meridian doesn’t offer and for which there is no official data.

This matters because we need to know the size of the problem electricity retailers, including Meridian, are trying to solve.

I can assure our customers that at Meridian, we will never disconnect people who are struggling and who are working with us to get them to a better place. Almost all of the people we disconnect are people who move into properties with no intention of paying, rack up large bills and then refuse to engage with us.

For any of our customers who are struggling to pay their power bills on time, even if they’re not in energy hardship, we have an experienced specialist credit team who can support them and offer payment arrangements, so people can pay a manageable amount to reduce any overdue balance.

We consult with budget advisers to help work out a long-term payment plan to help stop customers getting behind. We recommend various community groups to help if customers may need other support. We offer help and advice on how to consume power more efficiently to avoid high bills.

We work with the Ministry of Social Development and local councils to secure financial assistance for customers and offer various payment methods. And we accept Work and Income redirection payments, and we don’t charge late payment fees to our customers.

We’re also putting our own money where our mouth is. Last year we established a $5 million Energy Wellbeing Fund to support customers in energy hardship and provide a way to get them out of it for the long term, not just offer a short-term discount or credit.

We’ve created a dedicated wellbeing team and we work with partners to provide in-home assessments and tailored support to make homes healthier, easier and cheaper to heat.

Meridian Energy chief executive Neal Barclay. Photo / Doug Sherring

Our work might also involve budgeting advice and finding the right payment plan, or providing items like curtains, moisture prevention, insulation or heat pumps where needed.

We’re already helping more than 1400 households through our Energy Wellbeing Fund and have a goal to reach up to 5000 Meridian and Powershop customers.

But, we know that people are sometimes reluctant to come forward or put their hand up when they’re struggling. We understand. This stuff is hard.

We want every one of our customers to feel safe, secure and supported in their own home. If anything in this article sounds familiar, please reach out. We’ll be there to answer.