KEY POINTS:
Some households are losing hundreds of dollars a year by not shopping around for the best deal on electricity.
Since 2002, consumers have been able to compare deals relatively simply using online calculator PowerSwitch - but new UMR research released by the Electricity Commission this week found just 13 per cent of respondents had heard of the website.
An in-depth, national analysis indicated many customers could save $150 a year or more by switching to the cheapest supplier in their area.
Yet, the commission said, a "sizeable proportion" did not do it.
For residential customers with average power use and on the most common tariff , the study found potential savings of shopping around varied from nothing to about $265 a year - or more if they could change to a more suitable plan.
The commission wrote there was an "untapped potential" for many customers to save money - some cases a "substantial" amount.
In its 200-plus page market design review options paper, it said the "mixed picture" on retail competition was among the issues of most immediate concern. The paper is out for consultation until September.
Commission chairman David Caygill told the Weekend Herald the paper showed the basic structure of electricity provision was as expected given New Zealand's size and isolation.
But he said more vigorous competition between retailers could be useful.
"What this study discloses is that most of them don't compete across the whole country and that there is more competition in some parts of the country - typically in the big cities - than in other parts."
Mr Caygill said consumers were not getting ripped off, however, in some instances there were questions around retail margins, which varied from region to region.
Among the suggestions listed in the paper was introducing a requirement for electricity providers to disclose price information to the commission, which could then be passed to PowerSwitch - the website run by Consumer New Zealand and partly funded by the Ministry of Consumer Affairs - to try to make it easier for customers to switch.
It said the commission knew of at least one instance where an electricity retailer did not provide PowerSwitch with up-to-date information.
Mr Caygill said he wanted movement on other intentions flagged in the report, such as improving awareness of the website, by the end of the year.
PowerSwitch's Andrew Leggott said he was perplexed by some of the comments on the service, but welcomed suggestions to raise its profile.
He said good working relationships already existed with electricity companies. "We have regular and robust processes for checking and updating tariff information and we believe that we do a pretty good job of that. We do cover all the major tariff options."
The commission's paper examined a wide range of electricity-related issues, including energy affordability, availability of market information and demand-side participation.
It said electricity prices had risen sharply for residential users, with real prices going up by 28 per cent between 1999 and 2006.
It said Auckland had the lowest proportion of income spent on household energy.
Energy affordability was a growing problem for some New Zealand households and in 2007, the lowest income group on average spent just over 12 per cent of income on household energy.
Community worker Erin Fleming, director of Christian Community Care in Pukekohe, said many low income families struggled to pay for power.
While some opted for "pin power" - a pre-pay system - which meant not getting into debt, it was more expensive. The Electricity Commission began operating in 2003. Its main objective is to ensure electricity is produced and delivered to all classes of consumers in an efficient, fair, reliable and environmentally sustainable way.
HOW TO MAKE THE SWITCH
* Get a power bill with an actual reading and log on to use PowerSwitch to compare companies and plans available in your area.
* Once you've decided on the best power company, contact them and ask to switch. But remember to confirm with the company any savings you expect to make before you switch.
* Your new company will arrange the transfer for you.
* If it takes more than 25 working days to switch companies, you can complain to the Electricity Complaints Commissioner.
SOURCE: Consumer New Zealand's PowerSwitch
FRANKLIN RESIDENTS HAVE BEST CHANCE TO CUT ENERGY BILLS
The Priestley family of Tuakau have been Contact Energy customers for about four years - but never considered shopping around for electricity.
Stay-at-home-mum Stacey Priestley says the choice when signing up was easy: "It's pretty much the only company I knew."
Running details of their consumption through the PowerSwitch calculator shows estimated savings of $196 a year if they change to a plan with Meridian Energy. Estimates on plans offered by Mercury Energy, Energy Online and Genesis Energy also came in with savings.
The new Electricity Commission research showed residential customers in Franklin had the highest potential yearly savings in the country for average power users if they switched retailers.
Mrs Priestley says she and husband Stacy will reassess - but the decision is more complex than a simple price estimate.
Opening an account usually requires a bond and paying off any balance, she says. And the family's SmoothPay plan - making $40 a week payments throughout the year - helps with budgeting, particularly taking the pressure off during winter.
In the meantime, the family is making lifestyle changes to try to cut down on power.
"It's kind of hard in the winter - especially when you can't dry your clothes properly," Mrs Priestley says.
She says keeping bedrooms warm for Kimiora, 7, Nathaniel, 2, and 7-month-old Harmony is a priority.
Roast dinners have been sacrificed, however, in favour of quick-to-prepare meals, such as pan-fried chops and boiled potatoes.
"[You can cook it] in the frying pan and on top of the stove in about 10 minutes."
The PowerSwitch website was still offline last night , following a virus attack a week ago. It was expected to be live again next week.
