Here comes winter - and power price rises

Mercury Energy customers in north and west Auckland face a price increase of 3.9%. Photo / Supplied

Homeowners face increasing power costs as winter looms, despite Government calls for restraint in power company pricing.

Genesis Energy is increasing electricity prices, and Contact Energy will raise its gas price.

Meridian Energy increased its power prices in February.

Taxpayer-owned Genesis is raising prices for residential electricity customers in Auckland and northern Waikato next month.

About 17,000 Auckland customers in Vector lines area will pay an extra 2.8 per cent. This includes increases in Vector's fixed charges.

About 58,000 northern Waikato consumers face a 3.8 per cent increase, including lines company price increases.

Prices will also rise for some lower South Island customers from May 17.

The company's retail general manager, Dean Carroll, said the increases were needed because of rising energy and network costs.

"We have held increases back as long as possible, recognising that households are under increasing cost pressures," he said.

"We recognise that we need to act responsibly when it comes to price changes and have factored that into the level of the increases."

In December, Genesis lifted power prices by 9 per cent for residential consumers on the North Shore.

Genesis is one of the state-owned enterprises under scrutiny from the Government, which is unhappy about dividends returned but which has also criticised power price increases.

Mr Carroll said the company was "doing everything possible" to manage its costs.

Contact Energy's 70,000 gas customers throughout the country also face increases from next month. Charges will go up by a flat rate of 13.5c a day from May 1.

The company says the price it pays for wholesale gas has increased by 25 per cent.

It has taken the sting out of the rise by increasing its discount for customers who have Contact electricity and gas from 10c a day to 40c a day.

Meridian Energy said last month it would increase power bills for 180,000 customers by an average of 6.5 per cent, on top of a 6 per cent increase last September.

It said it had already absorbed a lot of cost increases and had no choice but to pass on the cost of boosting its generating capacity.

Domestic Energy Users Network analyst Molly Mellhuish said that the raised prices were the result of the "ratcheting effect" between the private and public sector.

"The increases are in tune with the insistence by the Government that SOEs get higher profits and get higher dividends.

"In November the SOEs were lagging behind - the private companies were leading the way in prices hikes. This is a further illustration of the ratchet effect; which ever one starts the others follow."

She said rises in domestic electricity prices would be difficult for homeowners to handle, and also created a health concern.

"Every price increase will lead to further illnesses and deaths from cold houses."

* Prices going up

Genesis Energy: 2.8 per cent electricity price rise for Auckland customers in Vector lines area, 3.8 per cent in northern Waikato.

Contact Energy: 13.5c a day increase for gas customers. Electricity prices remain unchanged.

Meridian: 6.5 per cent average electricity price increase nationwide.

Mercury Energy: 3.9 per cent electricity price increase in north and west Auckland.