Power company switch not always a quick flick

By CHRIS DANIELS consumer reporter

So you want to switch power companies?

Power companies have admitted this week that the change to an open market of competing power companies was too far, too fast, bringing stories of wrong bills, delays and muddles.

Today, as part of the Herald investigation into the state of the power industry, we offer advice to people who have switched to a new company, or are considering a change.

One of people's biggest concerns is the time it takes to get a power bill after switching to a new company. Some have waited up to six months for their first bill.

Many are worried that when the bill finally turns up, they will be asked to pay it too quickly.

The best approach, say consumer advocates, is to negotiate - do not simply accept a power company's terms for repayment. Work out a way to pay the bill that is fair and does not cause you hardship.

There is no law or regulation dictating how long a company can reasonably give a customer to pay a large bill, but it should depend on the circumstances of the individual.

Many companies include a clause in their contracts saying they will not disconnect a customer over a disputed bill.

But not all do this, so it is important to check before switching.

Trustpower promises that new customers will not be asked to pay any more than two months' charges on a delayed bill - regardless of the reasons for the delay.

Raewyn Nielsen, executive officer of the Federation of Budgeting Services, said most of the big power companies cooperated with the service to put together reasonable plans for paying bills.

Whatever the method used, it was important that some money was put aside for when a bill finally did arrive.

Bruce Thompson, spokesman for TransAlta, said the worst thing a customer could do was sit and wait for bills without trying to contact the company involved.

There is no easy answer to the problem, but two things are certain: contact the company as soon as you realise you have not been sent a bill; and, perhaps more importantly, put money aside. You will eventually have to pay for that power.

Other problems with power companies should be noted:

* Be careful when dealing with door-to-door sellers or telemarketers trying to get you to switch companies.

There have been cases of people thinking they were simply asking for more information, when they were actually agreeing to switch to another company.

It can be done over the phone, without the account-holder actually signing a contract or switching authorisation.

* The Consumers' Institute and the Ministry of Commerce have put together a "Powerswitch" website that allows consumers to work out how to get the cheapest power.

But any information taken from the site should be checked with the power company.

Any Citizens Advice Bureau will be able to help you work out which company is best for you, and any subscriber to the Consumers' Institute can write in and have the work done by mail.

Go to www.cosumer.org.nz then click onto the headline "Powerswitch."

This will take you to the website, which allows you to select where you live, which company you use at present and how many people live in your house. It helps to have a power bill handy.

After selecting what best suits your situation, it will then work out which company and plan will suit best.

But most of the power companies and consumer groups advise that cheaper power also comes at a price.

For instance, Mercury and First Electric are owned by the state-owned enterprise Mighty River Power.

Both these "brands" sell power at different prices, with First Electric tending to be cheaper.

But the level of service is different, as First Electric does not read meters every month, while Mercury now does.

* Household electricity bills have increased by 3 per cent since April 1, 1998, not April 1, 1999, as reported in the Herald on Tuesday.

Herald Online feature:
Overload - our troubled power companies

Have you had a problem with your power company?

E-mail our reporters: Josie Clarke or Chris Daniels