Power companies join on database

By DANIEL RIORDAN

Power customers should be able to change suppliers more easily after most of the country's power companies struck a deal with credit information company Receivables Management Group (RMG), improving their access to customers' credit histories with their previous suppliers.

RMG has developed a database for power companies representing 75 per cent of all power customers and says discussions with companies representing the remaining 25 per cent are well advanced.

Since April 1999, when power companies were allowed to compete for customers, 261,000 customers out of 1.7 million have switched suppliers. The average cost of credit checks on each of those customers is about $5.

RMG chief executive Paul Cooney said the deal had the potential to reduce power companies' bad-debt writeoffs by 10 to 15 per cent a year, saving the industry millions of dollars.

Some of those savings might be passed on in lower charges to customers.

How much the power companies are paying RMG has yet to be decided.

The power companies decided to band together and work with one credit information supplier about a year ago, said Nigel Hamilton, New Zealand product manager of RMG subsidiary CreditNet International.

The firm developed the database with Auckland company Atlantis Marketing, owned 25 per cent by RMG.

The power companies' ability to cooperate on this deal hints at a smoother time ahead for a market beset with problems that have affected the quality and reliability of power supply.

Mr Hamilton suggests that the companies could possibly also cooperate on meter reading and other customer-switching information.

Australia-based RMG was formed in June from the merger of 16 small receivables management businesses in Australia and New Zealand. The company is 27 per cent owned by Auckland entrepreneur Eric Watson, and is listed on the Australian and NZ Stock Exchanges.