Winter 2025

Open letter to all power companies

21 February 2025

Dear chief executives,

As winter approaches, our organisations are deeply concerned about projected rises in electricity prices. In a context where thousands of households are already struggling financially, further price pressures will result in more people rationing, or going without, the electricity that is essential for them to be warm and well.

We know that you share our concerns. We are writing to urge you to use all levers available to you to minimise hardship and disconnections this winter.

We welcome this week’s launch by ERANZ of an information booklet for customers struggling with their power bill. We applaud last year’s decision by Contact Energy to stop charging disconnection and reconnection fees in cases of non-payment. We are also impressed by the efforts of some companies to serve customers that other retailers have refused due to credit history, and we admire the hard work by some companies to minimise disconnections for non-payment. These initiatives make a difference.

Despite these efforts, post-pay disconnections for non-payment were higher in 2024 than 2023. We know that public disconnection figures are only a fraction of the true picture, and we are fearful that disconnections may rise even further this winter.

We therefore request you consider stepping up even further, by taking the following achievable steps.

As soon as possible, proactively check whether all your customers are on the right plan for their energy usage. If you offer a plan that will be cheaper for them, automatically (and permanently) apply the savings they are missing out on. Doing this soon can help to prevent people from falling behind.
Stop charging disconnection and reconnection fees in cases of non-payment. People who have their power cut off do not need extra debt. We urge you to do everything in your power to avoid disconnecting people, but if you still decide to do so, then please do not charge additional fees that exacerbate their hardship.
If you offer prepay, please ensure that the cost per KWh (including fees) is no higher than the price of your cheapest post-pay plan (including discounts). People with no other options but prepay should not have to pay a premium.
Offer the essential service of electricity to every person who requests it, regardless of their credit history, and ensure they have an option of a post-pay plan. As providers of an essential service it is your responsibility to serve a mixed community that includes people who struggle with debt but have no less need for warmth and wellbeing.

We look forward to hearing from you whether you can take these steps. We would love to meet with you to discuss any of this further.

Yours sincerely,