Big families, sick may pay more for power

Large families and the sick are set to bear the cost of low daily power supply charges, with electricity companies threatening to recoup their losses by adding 2 per cent to high users' bills.

Power companies have until October 1 to cut their fixed daily charges from about 70c to 30c for customers who use fewer than 8000 units a year - estimated by the Government to be the average household consumption.

Those expected to benefit the most are the elderly and small households.

But Genesis Energy chief executive Murray Jackson said a large number of its customers fell into that category.

At present, it offered a low-user tariff called Kiwi Saver, but only to customers who used less than 4000 units a year.

As the fixed daily charge paid for meter reading, invoice billing and lines, power usage prices would have to rise to offset losses, he said. That could add up to 2 per cent to bills for heavy users.

Shirley Woodrow, president of the Federation of Family Budgeting Services, said those who used the most power were usually big families and people with health problems that required them to keep warm.

"They are not going to be in a position to pay higher power bills," she said.

"Unfortunately, when there is a really tight budget, the only thing that can give is food."

Most low users would save just $30 to $40 a year, with the extremely frugal saving $100.

Grey Power president Graham Stairmand said low fixed charges were great news for the elderly, but other groups in need would miss out.

"A solo mum living in a rented house with low insulation will be paying a heck of a lot for her power."

He called on power companies to offer the new fixed rate voluntarily, as many people would not know how much power they used and did not keep paid accounts. But retailers had the information and could tell them.

Senior Citizens Minister Ruth Dyson said the changes were about making power more affordable for those who needed it.

"I'm sure that this latest move will go a long way to ensuring many older Kiwis get a fair deal out of the power companies," she said.

But Act commerce spokesman Stephen Franks said holiday home owners who only turned the water and heaters on occasionally would reap the biggest benefits.

- NZPA