According to Powerswitch data, the fixed daily charge for gas increased by an average of 25% year over year, while the cost per kilowatt hour rose by an average of 33%
For electricity, the fixed charge increased by 21% year-on-year, with the 24-hour price per kilowatt hour rising by 12% and the night rate going up by 13% on average.
“There are thousands of plans; prices change unevenly across retailers and regions, and a plan that was once cost-effective may no longer be. Individual household needs also change over time, further complicating matters,” Powerswitch general manager Paul Fuge said.
“Many people are surprised by how much prices vary. Those who switch plans using Consumer NZ’s free Powerswitch tool save nearly $500 per year on average.”
“Even non-switchers can use the tool to negotiate better deals. There are thousands of electricity plans available across the country, and what one household pays can differ markedly from another – something that often surprises people.”
Fuge said retailers frequently fail to inform customers about the availability of cheaper plans, urging consumers to take the initiative to regularly review their options.
He also explained that fixed and variable charges impact households in different ways.
“For example, rising fixed charges may have little effect on high-usage households but more on low-usage ones,” Fuge said. “This makes it difficult to generalise about annual price changes. The opaque and inconsistent nature of electricity pricing leads to confusion, apathy, and mistrust.
“Consumer NZ argues this is unnecessary and advocates for greater transparency, consistency, and simplicity in pricing.”
Fuge noted that electricity prices are currently increasing at a rate higher than inflation.
“Some retailers have highlighted that electricity prices were below inflation over the past five years. While technically true, this is somewhat misleading. The key reason is how line charges – the regulated part of your bill – are set. The Commerce Commission regulates these charges in five-year cycles. The most recent cycle began on 1 April this year and brought significant increases. By contrast, line charges fell in real terms during the previous cycle, when inflation was lower.”
For Fuge, the retail model succeeds “not through value or service, but through confusion and inertia,” causing many households to overpay by hundreds of dollars annually.